SEC Halts Telegram App From Flooding U.S. With Its Digital Coins

The Securities and Exchange Commission obtained a restraining order to stop the encrypted messaging app Telegram from flooding the U.S. with digital tokens, claiming that its coins are unregistered securities that can’t be sold to American investors.

The order halts Telegram from selling digital tokens known as Grams, according to a complaint unsealed Friday in federal court in Manhattan.

Telegram raised more than $1.7 billion in 2018, with plans to deliver almost 3 billion Grams to its investors by the end of October of this year. The SEC said the fundraising was illegally marketed in the U.S. because Telegram never ...