That's not quite right. Imagine you're a Russian citizen living in Russia proper, and you want to sell prospective stakes. Russia rules that you can't do this because you're not accredited, and you're asking people to buy a kind of security.
You then ask if you can sell your security to people in the UK. Russia repeats itself, more slowly this time: No, you're not accredited and you're trying to sell a security - stop it.
So then you explain, "but this isn't just a security, it's a decentralized open security based on cryptographic principles and new technologies and there's computers involved!"
And then Russia repeats itself once more, "No, you're not accredited, it's still a security, what part of this is hard to understand?"
I feel like our disagreement here is based on a different understanding of a fact that I might legitimately have wrong: my understanding is that the owners of Telegram are literally Russian citizens living in Europe; are they actually US citizens? (FWIW, a quick re-check of Wikipedia to verify my memory here is definitely making it sound like the Durov brothers are Russian nationals, but maybe they have now become official citizens of an island in the Caribbean as part of their "self-exile"? I don't think that Saint Kitts and Nevis is a US territory, though.)
Except they didn't want to sell to Russia or Europe. They ALREADY sold to institutional investors in the US and wanted more. But they were attempting to not be subject to the SEC. Not gonna happen.
That's not quite right - they did say in the original offering that they would be spending investors' money on Telegram Messenger's daily operations. The judge's words are:
> Telegram subsequently report ed that, from January 2018 to January 2020, it spent $405 million, about 24% of the proceeds from the offering of Grams, on the development of the TON Blockchain and the operations of Messenger.
As far as I understand it, they're doing this under the Telgram brand, but it's effectively whatever organization "owns" the TON effort and where they are incorporated.
It looks like there are at least two "Telegram" orgs, one located in the UK (according to the Bloomgberg profile), and I'm not clear if this other one is in the US or somewhere in the EU.
There's an issue if they're offering a security (which they basically are). They could make that security available through a foreign regulated market legally, but they can't allow "the world" to buy it. If they could restrict purchasing with a legal framework then they may be able to resist the judge's orders that forces them to never sell it.
But yes, US anti-money laundering law is some very intense stuff.
I agree that the situation you describe seems like an overreach, but the US likes to throw its weight around. For that matter so does the EU (ex GDPR), China, and really any other country. My impression is that most countries will happily ignore jurisdiction, pass laws that they claim apply to the entire world, and then do their best to find creative means of enforcing them on outsiders. See the ongoing Toshiba nonsense for a flagrant example of such. (https://reut.rs/2RDFjMz) (https://www.bloomberg.com/opinion/articles/2019-06-26/everyt...)
That being said, it seems Telegram's situation is far more complicated; I asked about the same thing when it came up previously (https://news.ycombinator.com/item?id=22394276). They are likely operating out of a jurisdiction which is explicitly subject via treaty to at least some US laws. They were also initially selling to US investors, and I suspect that many of their hypothetical overseas investors would have ultimately had to comply with US securities laws for their own reasons at the end of the day.
My take on the situation at this point is that violating laws in a jurisdiction with an extradition agreement to the country in question is generally a bad idea. Moreover, ignoring US securities regulations makes for a poor business plan since it means neither you nor your customers can realistically be located in such a jurisdiction (ie most of them).
You then ask if you can sell your security to people in the UK. Russia repeats itself, more slowly this time: No, you're not accredited and you're trying to sell a security - stop it.
So then you explain, "but this isn't just a security, it's a decentralized open security based on cryptographic principles and new technologies and there's computers involved!"
And then Russia repeats itself once more, "No, you're not accredited, it's still a security, what part of this is hard to understand?"