Telegram abandons $1.7 billion crypto project

In brief

  • Telegram has left TON
  • The SEC delayed the launch of TON, and Telegram had to return investors their money.
  • It does not support third party efforts.

Telegram, the operator of the 400 million strong messenger app, announced today that it has given up its upcoming blockchain network, the Telegram Open Network, after a lengthy, protracted dispute with the SEC.

“Today is a sad day for us here at Telegram. We announce the termination of our blockchain project.” Pavel Durov, co-founder of Telegram, wrote in a blog post. “Telegram’s active involvement with TON is over.”

As of October 2019, the SEC has alleged that Telegram’s ICO worth $ 1.7 billion in 2018 for the cryptocurrency that powers the network, Grams, was an illegal sale of securities.

The SEC secured a temporary order after a temporary order, delaying the launch of the network. Due to a clause in the Grams purchase agreement, Telegram promised to return the tokens if the network didn’t start on April 30. The network wouldn’t start, so Telegram offered to return their money to investors.

The project broke up less than two weeks later.

“While networks based on the technology we built for TON may appear, we have no ties to them and will likely never support them,” Durov said.