After years of drama with the SEC, Telegram is calling it quits on its crypto-focused subsidiary, Telegram Open Network (TON).
“Telegram’s active involvement with TON is over,” wrote Pavel Durov, founder and CEO, in an announcement on his channel. “You may see – or may have already seen – sites using my name or the Telegram brand or the ‘TON’ abbreviation to promote their projects. Don’t trust them with your money or data.”
TON was a blockchain platform designed to offer decentralized cryptocurrency to anyone with a smartphone, in a similar fashion to Facebook’s Libra project (which has also faced significant scrutiny).
Last October, the SEC ordered Telegram to halt sales of its cryptocurrency (called Gram) after it failed to register an early sale of $1.7 billion in tokens prior to launching the network. The funds were raised in a series of what Telegram billed as pre-ICO offerings back in 2018, though the company ended up canceling the much-hyped ICO due (in part) to increased SEC scrutiny.
In late March, U.S. District Judge Kevin Castel of Manhattan issued a preliminary injunction in favor of the suit by the Securities and Exchange Commission to bar the launch of TON blockchain platform.
Durov spoke out against the ruling in his announcement, arguing that American courts shouldn’t have the power to stop the sale of cryptocurrency beyond US borders, and he urged others to take up the decentralization fight in Telegram’s stead.
“I want to conclude this post by wishing luck to all those striving for decentralization, balance and equality in the world. You are fighting the right battle. This battle may well be the most important battle of our generation. We hope that you succeed where we have failed,” wrote Durov, cautioning people to stay away from independent versions of TON built by third-party entities.
“So be careful, and don’t let anyone mislead you.”