After wrapping up its blockchain project, Telegram has now officially withdrawn from the court battle against the Securities and Exchange Commission (SEC) for lifting the ban on Gram tokens.
In a court filing on Friday, the encrypted messaging giant has pulled its appeal against the previous court decision favoring SEC to block Gram distribution both in the US and overseas.
“The parties in the above-referenced case have filed a stipulation withdrawing this appeal pursuant to Local Rule 42.1,” the latest filing at the US Court of Appeals for the Second Circuit read.
Though this will dismiss the case without any prejudice, it can be opened at a later date.
This came weeks after the company’s decision to abandon the development of TON blockchain, which Pavel Durov, founder and CEO of the company, made public earlier this month.
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An ambitious project went bust
Telegram raised $1.7 billion in two private sales of its Gram token in 2018 and assured the investors to launch TON and distribute the tokens in October 2019.
However, weeks before the deadline the SEC put a ban on the project showing violations of the US securities law.
Though Telegram delayed the launch till April 2020 with an assurance of a further $80 million investment in the project, it had to postpone the launch again due to uncertainties.
Last month, the company offered the investors an exit option with 72 percent of their initial investment, or loan the amount to Telegram for a year and receive 110 percent of the investment. However, US-based investors were bound to take the first option.
In the original whitepaper, Telegram stated that in case of the failure of the TON launch with the initial deadline, the company will refund the whole amount, but now the investors have been pushed to a weird position.
Though many investors are not happy with the company’s decision, no litigation against the company has been made public yet.