Telegram Calls-Off Its ICO Plans After Having Raised $1.7 Billion in Presale
Popular messaging app Telegram who managed to raise a whopping $1.7 Billion from nearly 200 private investors, has now called-off the plans for the public sale of its own cryptocurrency ‘Gram’. According to the latest report from the Wall Street Journal, a source familiar with the matter said that the messaging giant won’t be opening its cryptocurrency for token sale through Initial Coin Offering (ICO).
Earlier this year in January, Telegram announced its plans of launching a third-generation blockchain called Telegram Open Network (TON) that would host a digital payment system competing with the likes of the strongest players in the segment like Visa and MasterCard. In addition, TON will also be hosting thousands of decentralized applications on its platform similar to Ethereum, but much bigger in size comparison.
In the last few months, the company announced to have raised $1.7 billion in two rounds of pre-sale ICO where nearly 200 institutional investors and high-net individuals participated in the private sale. Some sources say that Telegram might have raised enough money required to support the development of its TON and hence it might have cancelled the plans for a public sale. The sources also claim that it is quite possible that the messaging giant might distribute all the tokens among the private investors for the amount raised till now.
Moreover, in the past few months, the regulatory environment across the globe has changed to a great extent with major agencies like the Commodity Futures Trading Commission (CFTC) and Securities and Exchange Commission (SEC) introducing stricter rules in the crypto space. Sources say that this could be another possible reason for Telegram to call-off its ICO Plans.
In February this year, the SEC had issued subpoenas to many companies who had launched ICOs. In some hard-hitting comments, SEC chairman Jay Clayton has a message for all the businesses trying to dodge the registration process. Clayton said: “Many ICOs are being conducted illegally. Their promoters and other participants are not following our security laws.”
Moreover, many analysts and experts from the cryptocurrency space have expressed discontent with the notoriously opaque behaviour of Telegram in unveiling any kind of technical details pertaining to its TON project or even its token sale.
Christian Catalini, a professor and founder of MIT’s Cryptoeconomics Lab said: “We actually document in our research paper that there has been a major transition from more technical white papers to the kind of white papers that look a lot more like sales pitches. There’s been less focus on technical details over time and, for some of these, much more on selling the vision. In the case of the Telegram one, there is a lot that is being promised and not a lot of clarity on how that would be delivered.”