Telegram ICO - Timeline of what really happened
As recently as last month, May 2020, there was a big announcement from Telegram. This was that the company’s flagship project, the Telegram Open Network (TON), is no longer continuing. TON has had a lot of ups and downs since its first conception, however despite all the downs, it still managed to draw huge interest from investors and crypto enthusiasts alike.
This article will go into the history of Telegram’s TON, the ICO, beginning at the first inception moving all the way forward to the latest announcement. So for anyone who wants to learn more about what could have been, keep reading on below to find out.
But first, for anyone who has read this far but isn’t entirely sure what we’re talking about…
What is Telegram?
To discuss the cryptocurrency project that Telegram was involved in, we first need to outline what Telegram is. Initially, Telegram had nothing to do with cryptocurrency, it was founded in 2013 by Pavel Durov as an encrypted messaging app. On the surface, it works in a very similar way to Whatsapp, however beneath the interface is almost impossible to break encryption. For governments and security services that are used to being able to snoop in on messages, this encryption caused some real problems.
However, since the launch of the messaging app, the company turned its eyes further towards blockchain technology and cryptocurrencies. The initial idea was the project TON, that we’ve already mentioned above, TON was a blockchain platform that facilitated a cryptocurrency that was named Gram.
The design and concept of Gram followed similar technology and principles that the leading cryptocurrencies Bitcoin and Ethereum adopted. It proposed the decentralization of money away from states and governments by using blockchain technology. How it aimed to set itself apart from Bitcoin and Ethereum was through much better speeds and potential to scale.
On this, Durov made the point that, ‘existing networks such as the Bitcoin and Ethereum blockchains do not have the capability to replace high-volume transaction mechanisms like credit cards and fiat currency.’ In particular, this is where Gram was designed to outperform the market leaders.
After the first announcement, the TON crypto currency project raised a significant amount of funds from private investors in its initial coin offering (ICO), roughly $1.7 billion. Following this extremely promising start, the TON project came to a screeching halt thanks to the SEC. In October 2019, the SEC decided that the cryptocurrency associated with TON, Gram, was an unregistered security. Moving forward to March 2020, this decision was upheld by a judge in the United States. This decision meant that gram would not be allowed to be distributed not only in the US but also around the world.
On the ruling, Durov said the US judges point was that, ‘a US citizen might find some way of accessing the TON platform after it launched. So, to prevent this, grams shouldn’t be allowed to be distributed anywhere in the world – even if every other country on the planet seemed to be perfectly fine with TON’.
Durov continued by saying the implication of the court in the US’s decision was that Telegram, ‘have made the difficult decision not to proceed with TON.’ The technology was heavily reliant on the US, Durov continued, ‘Sadly, the US judge is right about one thing […] we are still dependent on the United States when it comes to finance and technology.’
This was a huge problem from the Telegram, so much so that they felt compelled to pay back their investors, who could receive funds in multiple ways. However, for investors in the US, only 72% of funds were available.
The cryptocurrency market is extremely competitive and since the recent news, there have already been brands trying to utilise the Telegram brand to get ahead and promote themselves. On this topic, Durov made the point, ‘Don’t trust them with your money or data.’ He continued by stating, ‘While networks based on the technology we built for TON may appear, we won’t have any affiliation with them and are unlikely to ever support them in any way. So be careful, and don’t let anyone mislead you’.
While this is the current end of the Telegram project, there is hope within the business that it can continue again in the future. For people investing in cryptocurrencies, this should serve as a stark reminder of the volatility of these types of investments. While a lot of money can be made, there is always a risk to your investments.