Telegram to pay back $1.2 billion to investors & $18.5 million fine on failed token
Following the Crypto space in the last year or so, one of the most widely talked about topics was the launch of Telegram’s own Cryptocurrency called “GRAM” tokens. The end results? A whopping $1.2 Billion dollar payback to the investors for their part in the failed token saga and a separate $18.5 million fine for this activity on top of it. When news first broke out of the messaging app wanting to get involved in the business by launching its own private network labelled “TON”, it was seen by many as something that would either shake the whole world to its core or fall flat on its face. The downside of having a 400 million userbase though is that news spreads very quickly and it reached the ears of the U.S. Securities and Exchanges Commission (SEC).
What happened next was a 6-month trial in which Telegram was investigated severely by the authorities on grounds of violating security laws. Back in 2017, CEO of Telegram Pavel Durov and his team started working on the next generation blockchain network called “Telegram Open Network” or TON and a Cryptocurrency called GRAM. It was designed to be decentralized following Bitcoin and Ethereum but was stated to be better in terms of scalability and speed. For this project, telegram managed to raise $1.7 Billion in 2018 from an Initial Coin Offering. In October 2019, a Judge from the SEC stopped this sale stating that the tokens being distributed were unregistered securities and that the selling should not even continue outside the US. The end result however saw Telegram being made to payback the investors $1.2 Billion over the next few years. Reports claim that Telegram have offered to pay their investors in two ways. A 72% to those in the US to be paid this year and to those investors abroad, a 110% return after a year. A civil penalty of $18.5 Million is to be paid to the SEC within 30 days as well.
But what seemed like an eternity to solve this issue has finally been set. Telegram are to pay a fine, the GRAM cryptocurrency is no more. TON still exists but if Telegram are planning another stint at something different, they will have to notify the SEC 45 days before starting anything and a 3-year watch has been determined on Telegram for any future plans. Some investors are not happy with the ruling since it cuts down their initial returns so they might sue the messaging company. One thing we are certain of is that even though the ruling was finalized on June 26th 2020, we still haven’t heard the last of this fiasco. What are your thoughts on this story? Do you think Telegram were wrongly judged? Is the TON network actually better than Bitcoin or Ethereum? Will they launch another cryptocurrency in the future? Drop your comments below or share with us your opinions and we will feature you on our platform!