Rest in peace GRAM coin, we hardly knew ye.
No, seriously. TON was the next big cryptocurrency project attached to one of the biggest messaging apps in the world — Telegram — run by Pavel Durov, the expat Russian holed up somewhere between the Caribbean and Dubai after self-exiling from Moscow.
Durov said on his Telegram channel today that the two and a half year blockchain and crypto project has been put to sleep.
Ironically, after leaving Russia because the government wanted his encryption keys to his social media firm, Durov’s cryptocurrency idea lost steam because of a U.S. court.
“The technology we created allowed for an open, free, decentralized exchange of value and ideas. TON had the potential to revolutionize how people store and transfer funds and information,” he wrote on his channel. “Unfortunately, a U.S. court stopped TON from happening.”
New York’s Southern District court declared that GRAM couldn’t be distributed in the United States. The judge ruled that U.S. citizens might find some way of accessing the TON platform after it launched, so the platform couldn’t be allowed either. Keeping the project alive would be difficult now because it meant a legal headache for Durov to make sure no Americans would ever be involved in transactions on the platform.
“If the U.S. suddenly decided to ban coffee and demanded coffee shops in Italy be closed because some American might come there – we doubt anyone would agree,” he said.
Today marks the last day for Telegram’s active involvement with TON. No present or past member of Telegram is involved with any TON projects out there. Some networks based on the technology may appear, they won’t have any affiliation with Telegram, Durov told his channel followers.
TON Labs, a startup that had been running a test network, launched its own version of the network last week, dubbed “Free TON,” after Telegram announced further delays, Coindesk reported today.
The Securities and Exchange Commission frowns upon cryptocurrencies, for the most part. Though Americans are allowed to own them, they come with almost no investor protections.
Back in October, the SEC sought a temporary restraining order against the Telegram blockchain project, stopping them temporarily from offering, selling, delivering or distributing its GRAM coin.
The SEC said that it thought Telegram was going to “flood the markets with billions of . . . (coins) through an unregistered offering of securities.” The SEC said that “without a registration statement in place, Telegram’s planned distribution would violate the federal securities laws” and that pretty much put a nail in that blockchain operation’s coffin.
For Durov, the struggle is real. He wished other true believers good luck in trying to create a decentralized money system.
“You are fighting the right battle,” he said. “This battle may well be the most important battle of our generation. We hope that you succeed where we have failed.
I’ve spent 20 years as a reporter for the best in the business, including as a Brazil-based staffer for WSJ. Since 2011, I focus on business and investing in the big emerging markets exclusively for Forbes. My work has appeared in The Boston Globe, The Nation, Salon and USA Today. Occasional BBC guest. Former holder of the FINRA Series 7 and 66. Doesn’t follow the herd.