When Telegram announced the Telegram Open Network (TON) project, with its Gram cryptocurrency, the crypto sector experienced a real uproar.
Although the speculative bubble was bursting in early 2018, interest in this project exploded.
In fact, on the one hand, it was backed by a giant like Telegram, well known in the crypto sector, while on the other, it promised impressive technical performance.
Telegram is one of the leading messaging apps in the world, with about 400 million active users every month and about 1.5 million new subscribers every day. The messaging app industry has seen some monopoly in recent years, especially since Facebook bought WhatsApp for $19 billion in February 2014.
The token sale of Telegram
It did not even need to resort to a public ICO to raise the necessary funds for the development and launch of the project, since two rounds of private collection were enough to raise the stratospheric sum of $1.7 billion.
Thus it was not a real ICO, because it was never really launched: Telegram was limited to a private collection from large investors.
How do Gram and TON work
From the technical point of view, this project seemed to have no particular problem, to the point that after about a year, in February 2019, it was announced that the development of the platform was 90% ready.
So what went wrong?
The problem was exclusively legal: the US SEC decided not to authorize the sale of Gram tokens to American investors.
At first, this only led to the postponement of the launch of the platform, but the matter became complicated over the months, eventually turning into a real war between the SEC and Telegram.
The war was ultimately won by the SEC as Telegram actually raised the white flag. In fact, the SEC not only warned Telegram not to sell Gram tokens to US investors but effectively banned their sale worldwide, claiming that once they were put on the market, they could still be bought by US investors.
As Telegram founder Pavel Durov said:
“A judge used this reasoning to rule that people should not be allowed to buy or sell Grams like they can buy or sell Bitcoins”.
This effectively cut the snake’s head off, making it impossible to launch the Gram token on the market without violating US law.
How will it end at this point? Will investors get back what they invested?
To some extent, yes, but it seems that they will not receive the full amount invested and for this reason they decided to organize a class action since Telegram said it was willing to pay back only 72% of the amount invested.
As a result, the case is still in progress, due to the legal consequences of a new battle, this time between Telegram and investors, over the refund amount.
Telegram Open Network is a project definitively closed, despite some unauthorized clones who are trying to exploit its name to try to attract other potential investors, whereas the clash between Telegram and investors is likely to last much longer.