Encrypted messaging service Telegram terminates crypto payment project

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Posted on: May 14, 2020 4:04 pm EDT

Telegram, the popular encrypted messaging service, announced the end of its cryptocurrency and payment system project known as TON.

TON, which is short for Telegram Open Network, is a secure payments system that is based on the blockchain. It aimed to compete with industry giants such as Visa and Mastercard. The move comes after the company faced ongoing legal fights with American regulators.

Pavel Durov, one of the cofounders of Telegram recently stated, “We are announcing the discontinuation of our blockchain project.” He went on to note, “The technology we created allowed for an open, free, decentralized exchange of value and ideas. TON had the potential to revolutionize how people store and transfer funds and information. Unfortunately, a U.S. court stopped TON from happening.”

Through an initial coin offering (ICO) of 200 private investors, Telegram had raised $1.7 billion for its Gram virtual currency in 2018. The ICO led the US Securities and Exchange Commission to accuse Telegram of launching an unregistered securities sale. In March of 2020 a judge ruled the project couldn’t proceed unless the dispute with SEC was settled.

Pavel Durov noted that the US court ruling prevented TON from being used in other countries since US citizens would still be able to use it. Durov stated, “The United States can use its control of the dollar and the global financial system to close any bank or bank account in the world.”

Russian brothers Nikolai Durov and Pavel Durov launched Telegram in 2013. Telegram currently offers cloud-based VOIP calls and instant messaging for iOS, MacOS, Android, Windows and Linux. Users are able to exchange messages, photos, videos, and other files using Telegram’s open-source software. Telegram currently has more than 300 million active users. Telegram group video calling is expected to launch in 2020. More information about Telegram can be found at telegram.org.