After a long battle with the U.S. SEC, messaging app Telegram is giving up on its Telegram Open Network (TON) and the connected Gram (GRM) tokens, the firm’s CEO wrote in a blog post on 12 May.

In the post, called “What Was TON And Why It Is Over”, Pavel Durov said that his company will discontinue its efforts on the blockchain project, and will no longer be involved with TON in any way. As for the reason behind this decision, he cited a preliminary injunction from March, which the U.S. SEC won, that barred Telegram from launching TON or distributing its native Gram tokens anywhere in the world.

He wrote:


“The US court declared that Grams couldn’t be distributed not only in the United States, but globally. Why? Because, it said, a US citizen might find some way of accessing the TON platform after it launched. So, to prevent this, Grams shouldn’t be allowed to be distributed anywhere in the world – even if every other country on the planet seemed to be perfectly fine with TON.”

According to Durov, the court’s decision “implies that other countries don’t have the sovereignty to decide” if TON should be launched or not, and whether it was good or bad for their citizens. He also criticized the U.S. government’s effort to stop the launch of a network, which was based on the principles of decentralization. He further said that the U.S. have immense power because of the dollar and its global influence on the financial system, and can even influence companies such as Apple and Google to remove apps from their app stores.

“Unfortunately, we – the 96% of the world’s population living elsewhere – are dependent on decision makers elected by the 4% living in the US.This may change in the future. But today, we are in a vicious circle: you can’t bring more balance to an overly centralized world exactly because it’s so centralized. We did try though.”

Telegram’s first problems with the SEC came in October 2019, only days before the planned launch of the TON network, when the U.S. regulator accused the firm of violating U.S. securities law during its $1.7 billion initial coin fffering (ICO) in 2018. At that time Telegram had its investors vote on whether they agreed to delay the release of the network to 30 April, 2020, or receive “approximately 77 percent” of their investment back. Investors decided to stick with the project.

Later, in April 2020, the messaging app once again wanted to delay the launch of the project, this time to April 2021, citing the court decision from March which prohibited the firm from releasing the Gram tokens or launching TON. This time Telegram offered its investors either an immediate 72% refund, or a 110% one if the project was launched in a year. U.S. investors, however, could only take the 72% immediate refund option.

Though Telegram may no longer be involved in the TON project, it does not mean that the network is dead. Even before Telegram’s announcement was released, an independent community of validators, called Free TON, had already launched their own version of the TON blockchain. In his post, Durov commented on third-party efforts to launch versions of the TON blockchain, but distanced Telegram from them by saying that “we won’t have any affiliation with them and are unlikely to ever support them in any way”. That said, Duroved closed his post with an appeal to decentralization, writing:

“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.”

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