Telegram: From a Messaging App to a Major Player in the Crypto Space

Telegram launched as a simple messaging app in 2013. Today, it's a major player in the cryptocurrency space, integrating the TON blockchain.

Launched in 2013 as a simple messaging application, Telegram has since undergone a remarkable transformation, emerging as a major player in the cryptocurrency space. This article will delve into Telegram's journey, highlighting its origins, legal battles with the U.S. Securities and Exchange Commission (SEC), and its current role in the crypto community.

Telegram Origins and Shift to Crypto

Telegram began its journey as a messaging app, renowned for its robust security features and user-friendly interface. It offered encrypted chats and supported large group chats, quickly gaining popularity among users.

A significant milestone in Telegram's history was the introduction of bots in 2015. This enabled users to automate tasks, manage groups, and facilitate complex interactions within the app.

As the platform continued to grow, Telegram unveiled voice calls in 2017 and video calls in 2020, further enhancing its communication capabilities.

Continuing its evolution, Telegram launched channels in 2021, providing a new avenue for users to broadcast messages to vast audiences. This tool was later expanded with stories for channels, allowing users to share ephemeral content with unique dual-camera functionality and granular privacy settings.

Another notable addition was a transparent and fair giveaway system within channels, enabling users to participate for a chance to win real-world prizes.

Beyond messaging, the Durov brothers had a grander vision for Telegram - to create a decentralized platform that would revolutionize how people conducted digital transactions and communications. This led to the birth of the Telegram Open Network (TON) blockchain.

Developing the TON Blockchain

The TON Blockchain project commenced in earnest with the release of a whitepaper by Pavel Durov in 2018, outlining its technological advancements and potential applications.

Originally conceived to integrate cryptocurrency and blockchain features into the Telegram ecosystem, TON was designed with scalability in mind. It aimed to handle millions of transactions per second through a unique multi-blockchain architecture and sharding mechanism.

This mechanism splits the blockchain into a master chain, which governs the overall network, and multiple work chains, each capable of operating independently.

To actualize this dream, Telegram sought to raise funds through an initial coin offering (ICO). Prior to that, the company had already raised about $1.7 billion from 175 investors in a private sale of its native Gram token.

However, this success was short-lived. Soon after the presale, the U.S. Securities and Exchange Commission (SEC) set its regulatory sights on the platform.

Legal Battle with the SEC

In October 2019, the SEC filed a complaint against Telegram, alleging that the company had conducted an unregistered securities offering by selling Gram tokens. The commission argued that those tokens were securities and should have been registered under U.S. securities laws.

The legal battle culminated in a landmark decision in March 2020 when a U.S. federal court ruled in favor of the SEC, halting the distribution of Gram tokens.

As a result, Telegram postponed and eventually abandoned the project in May 2020. It also agreed to return the money raised in the pre-ICO event to investors and pay an $18.5 million civil penalty.

This decision had a significant impact on Telegram and sent shockwaves through the broader crypto industry, highlighting the regulatory challenges that blockchain projects faced.

Once Telegram stepped back, a group of independent developers continued to build TON, now renamed The Open Network, ensuring the project's survival.

Its development is now supported and guided by a non-profit organization, the TON Foundation, based in Zug, Switzerland. Steve Yun serves as the president of the TON Foundation, while Andrew Rogozov, former CEO of Russian social media site VK, is a founding member.

Throughout 2021 and 2022, the TON community focused on improving the network's architecture, implementing dynamic sharding, and refining its proof-of-stake consensus mechanism.

Telegram’s Continued Support and Integration

While no longer the architect of TON's development, Telegram has continued to support the platform. For instance, in September 2023, the messaging app, boasting over 800 million users at the time, integrated the TON Space self-custodial wallet.

This integration was followed by an introduction to an ad revenue-sharing system in March 2024, where payments were made exclusively in Toncoin (TON), the successor to Gram, fostering further engagement with the TON ecosystem.

In September 2023, Telegram officially endorsed TON, declaring the blockchain and its associated token as the app's “official web3 infrastructure.” This move sparked investor interest and led to substantial gains for the TON token.

As a result, the total value locked on TON surpassed $300 million on May 27, 2024, marking a significant milestone fueled by a community rewards program from the TON Foundation.

Telegram’s Current Role