Telegram’s Tug-of-War with the SEC
The ongoing saga between Telegram and the United States Securities and Exchange Commission (SEC) is more thrilling than a Netflix drama. Lawyers for the popular messaging platform recently shared that gathering the financial records requested by the SEC will take anywhere from five to seven weeks. Why so long? It seems that not all heroes wear capes, some too are fettered by foreign data protection laws.
Complexities of Compliance
In a court filing, Telegram’s legal team revealed that the process isn’t just a walk in the park; they need to analyze approximately 4,600 transactions involving 770 individuals and entities. That’s more than a few cups of coffee to keep them awake! The preliminary sampling indicates that 12 foreign jurisdictions were involved — and two of them were completely new to them. Talk about an international puzzle!
The Pressure of Privacy Laws
With data privacy laws becoming stricter than a parent during a sleepover, compliance becomes a Herculean task. The team estimates that it will nearly take two months just to ensure everything is correct, putting redactions and legal protections in place. They don’t want any unwanted attention for mishaps, and frankly, who could blame them?
The Court’s Decision & What Comes Next
Recently, the court denied the SEC’s request to force Telegram to disclose financial records related to its massive $1.7 billion initial coin offering (ICO). But wait, there’s a twist! Telegram has been ordered to ensure those records comply with all applicable foreign data privacy laws. This is like being given a pop quiz after studying the wrong material — stressful, to say the least.
The Bigger Picture
As noted by Cointelegraph, the SEC originally filed an emergency order against Telegram in October, claiming their ICO was an unregistered securities sale. The stakes are high, and not just for Telegram but for the entire crypto industry as the regulators ramp up scrutiny.
Depositions and Legal Drama
This week, Telegram’s founder, Pavel Durov, and two employees were expected to give their depositions in this convoluted case. You can only imagine the tension as they prepared for what was sure to be a grilling! With the courtroom illuminated by tension and zigzagging legal maneuvers, what will come next? Only time will tell.