- Telegram has abandoned its TON blockchain following sixth months of pressure for American authorities
- Founder Pavel Durov blames US authorities’ overreach for the project’s downfall
- Durov acknowledges “mistakes” and leaves others to take up the mantle of decentralization
Telegram has sensationally abandoned its TON blockchain plans, two years after raising $1.7 billion for its development, following huge pressure from American authorities. In a blog post entitled What Was TON And Why It Is Over, Telegram founder Pavel Durov lamented the actions of the US legal system and America’s political might in general, highlighting their ability to restrict the sale of goods and services in other countries. Where this leaves ICO contributors is not stipulated in the blog post, but with millions already spent on development there is virtually no chance of anyone getting all their money back.
Durov Compares Telegram Issues to Gold Mine
Telegram’s problems surfaced in October last year, 18 months after completing their record token raise for the TON blockchain, when the Securities and Exchange Commission (SEC) issued an ‘emergency action’ to halt the token distribution, claiming that the sale amounted to an unlicensed sale of securities. In his post, Durov compares this action to the US courts stopping the creation of a gold mine:
Then a judge comes and tells the mine builders: “Many people invested in the gold mine because they were looking for profits. And they didn’t want that gold for themselves, they wanted to sell it to other people. Because of this, you are not allowed to give them the gold.”
Durov also breaks down the reasons why the action in the US affected the operation of the Telegram blockchain worldwide, stating that the authorities were concerned that “a US citizen might find some way of accessing the TON blockchain after it launched.” Durov expands on America’s role in global affairs and the impact it has on everyone else in the world:
The US can use its control over the dollar and the global financial system to shut down any bank or bank account in the world. It can use its control over Apple and Google to remove apps from the App Store and Google Play. So yes, it is true that other countries do not have full sovereignty over what to allow on their territory. Unfortunately, we – the 96% of the world’s population living elsewhere – are dependent on decision makers elected by the 4% living in the US.
It is clear that Durov feels that Telegram has been very harshly treated, probably because of Telegram’s use of built in encryption and ability for users to chat in complete secrecy. This secrecy is anathema to a surveillance state like the US, and so it is no surprise that the authorities have taken the opportunity to slow its progress.
Durov acknowledges that the company has made “mistakes” in their efforts to launch the TON blockchain without disclosing what they are, but says that he is leaving it to “the next generations of entrepreneurs and developers to pick up the banner” and push for the kind of global decentralization he had envisioned.
All that now remains of the TON blockchain is a list of disgruntled investors, although Durov has already stated that the company’s equity value “will exceed the aggregate amount of its potential debt…by at least several times”, meaning that the company should be in a position to honor partial or even full refunds.