Telegram has rowed back on its pledge to offer extra grams tokens to those who hold on to their investment until launch time in another blow to frustrated investors. Telegram had previously offered investors an extra 10% of their investment in tokens if they rejected the 72% refund and held their tokens until the delayed launch date of April 2021. Telegram has now withdrawn this offer however after “discussions with the relevant authorities and our counsel” in a blow to the project and the company’s prestige.
“Uncertain Reception” Halts Telegram’s Plans
In a letter to investors seen by Coindesk, Telegram cited the frosty reception their plans were likely to garner from regulators were they to have gone ahead with their plans to effectively accept investors’ Telegram tokens as a loan:
Unfortunately, based on more recent discussions with relevant authorities and our counsel, we have made the difficult decision not to pursue an option involving grams or another cryptocurrency due to its uncertain reception from the relevant regulators.
The concept of a loan-based system is still on the table, according to Telegram, but the payment will not be in cryptocurrency. However, US-investors will have no choice but to accept the 72% refund, with Telegram asking investors to confirm their residential status and provide evidence for it by Monday, May 11.
A Mess of Telegram’s Own Making
Telegram’s ICO, the plans for which were revealed way back in January of 2018 when the crypto world was still suffering from ICO fever, has been nothing short of a disaster. After a year’s development, during which time seemingly no thought was given as to how US regulators might react to the ICO, the company is wading through a legal quagmire that began in October when the Securities and Exchange Commission (SEC) halted the ICO.
Despite seven months’ worth of legal wrangling under their belts, Telegram still managed to not properly consult their counsel before making an offer to investors, the withdrawal of which adds to the farrago and makes the world’s biggest ICO look like a soapbox derby car in the Daytona 500.