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What Was TON And Why It Is Over
- some_furry 6y agoThis was inevitable after the SEC got involved.
- shattl 6y agoIt looks as if Durov wants to distance himself and Telegram from the cryptocurrency subproject, in connection with the latest claims of regulatory authorities.
- floatingatoll 6y agoPreviously: "SEC halts Telegram's $1.7B token offering" (7 months ago, 201 comments): https://news.ycombinator.com/item?id=21228415 https://news.ycombinator.com/item?id=21228415 “We allege that the defendants have failed to provide investors with information regarding Grams and Telegram’s business operations, financial condition, risk factors, and management that the securities laws require.” “Telegram seeks to obtain the benefits of a public offering without complying with the long-established disclosure responsibilities designed to protect the investing public.”
- tw04 6y agoHis analogy is pretty poor IMO. A more realistic analogy is: imagine if a group of people got together and bought a plot of land to mine gold. Then imagine these people told all of their friends that they had a gold mine and were willing to split the output of the gold mine with all of their friends for just $10k/piece. Now imagine the government said: hey, you don't even know if there's gold on that land, but you're promising your investors that there is. And not only are they telling us we can't sell part of our non-existent gold to our friends, we can't sell it to people ANYWHERE. Sound completely unfair? Government overstep? We aren't allowed to sell people something that doesn't exist?
- anticensor 6y agoIt is called the futures and promises market.
- simonh 6y agoWhich has established rules and contracts guaranteeing and enforcing the rights of buyers and obligations of sellers.
- vmception 6y ago> And not only are they telling us we can't sell part of our non-existent gold to our friends, we can't sell it to people ANYWHERE. well they could, they'd just have to register with the government. but in this case, registering with the government isn't so simple because that "opts in" to a ton of other regulations which are usually okay, if the group of people weren't also trying to tie membership into their nightclub with whoever currently bears the right to own a piece of the gold mine. Now the regulations for investments are completely incompatible with general merchant services, regulations for consumer goods. The various governments have a chance to create a framework that works for both, but chooses to rely on the regulator for investments exclusively, or making it too expensive and irreconcilable to ask for clarification.
- tomc1985 6y ago> We aren't allowed to sell people something that doesn't exist? Seems reasonable to me
- thesz 6y agoSo kickstarter is a place for whom?
- cryptica 6y agoThe regulatory hypocrisy is clear.
- tomc1985 6y agoYet another venue to sell people dreams. How many kickstarters actually succeed? At least they promise something material, which is more than one can say about this TON shitcoin
- thesz 6y agoOur little conversation amounts, to me, to "we allow people to sell dreams as long as these dreams are allowed to sell by us". I cannot see how you resolve your allowance for regularly failing kickstarters and your allowance-not for TON. I see the value in TON beyond material. Compare it to Libra, to give you another point to discuss. For me, at the very least, TON could be a viable alternative to Libra - it is architecturally about the same PBFT (with useful twists) and, frankly, it does not possess Facebook-or-Libra-associated flaws.
- centimeter 6y agoYou're describing "prospecting", or (less charitably) "wildcatting", which is a legitimate business. > We aren't allowed to sell people something that doesn't exist? You're allowed to sell rights to things that might exist in the future. If someone puts a ton of money into something stupid that's pretty clearly not going to pay off proportional to the expense, that's on them. > you're promising your investors [a return] This is somewhat different from your first paragraph. Overselling your confidence in the financial outcome of a bet is (usually obvious) fraud, but that's a different problem from selling a stake in a risky endeavor. Not defending Telegram's stupid shitcoin, but trying to get the Government to stop this (whatever your probably loosely-held idea of "this" is) is probably not a good idea.
- cafard 6y agohttps://en.wikipedia.org/wiki/Bre-X https://en.wikipedia.org/wiki/Bre-X
- shawndrost 6y agoAnd now we have come full circle. The government does indeed permit wildcatting or prospecting, but it requires that all investors are accredited. The same is true for TON and other bitcoins -- the govt is not trying to forbid them, but merely require the normal level of investor vetting that is in place across the rest of the economy.
- centimeter 6y ago“Other bitcoins” doesn’t parse - did you mean “other shitcoins”? Bitcoin is a specific product, and shitcoins are a disjoint category. The government only requires people to be accredited for "ICO"s, not currency/utility "coins" like Bitcoin or Ethereum. As an aside, I believe the “accredited investor” category is mostly a subsidy of rich people. Exclude peasants from investing in the good high-return stuff and you can demand higher capital premiums.
- mokus 6y agoKleenex is a specific product too, but is often used as a generic term. “Bitcoin” might not be commonly used that way but it parses just fine to me.
- saurik 6y agoThe "anywhere" thing is weird though as these people don't live in the United States, so the analogy is that you are a Russian citizen living in Europe and you buy a plot of land; now, the US government tells you you aren't allowed to tell people in Europe that you maybe have a gold mine and maybe they should invest in shares of your gold, because, in the case that you do find gold, someone in the United States might one day buy some of it, which is actually kind of ridiculous on not just one but two levels: that the US has jurisdiction over your behavior at all when you aren't yourself a US citizen, you don't live in the US, and you aren't even dealing with other US citizens, because theoretically the people you deal with might one day themselves deal with US citizens (which is an analysis I am just believing from this article: I haven't read the actual complaints from the SEC); but also the very idea that the US thinks that the shares of future gold that may or may not exist might still be a security even after you find the gold (assuming you map it out and know how much exists after you find it, which I think is a reasonable analogy for a post-launch distributed protocol project) because of this weird theory that they sometimes have that "once a security always a security" (which is based on some context I have outside of this article).
- vorpalhex 6y agoThat's not quite right. Imagine you're a Russian citizen living in Russia proper, and you want to sell prospective stakes. Russia rules that you can't do this because you're not accredited, and you're asking people to buy a kind of security. You then ask if you can sell your security to people in the UK. Russia repeats itself, more slowly this time: No, you're not accredited and you're trying to sell a security - stop it. So then you explain, "but this isn't just a security, it's a decentralized open security based on cryptographic principles and new technologies and there's computers involved!" And then Russia repeats itself once more, "No, you're not accredited, it's still a security, what part of this is hard to understand?"
- saurik 6y agoI feel like our disagreement here is based on a different understanding of a fact that I might legitimately have wrong: my understanding is that the owners of Telegram are literally Russian citizens living in Europe; are they actually US citizens? (FWIW, a quick re-check of Wikipedia to verify my memory here is definitely making it sound like the Durov brothers are Russian nationals, but maybe they have now become official citizens of an island in the Caribbean as part of their "self-exile"? I don't think that Saint Kitts and Nevis is a US territory, though.)
- smsm42 6y agoWhat you just described is pretty much what nearly every startup in Silicon Valley does. Probably what 95% of startups anywhere do (very rarely, there's a startup where the "gold" is tangibly there, but it's a rare case). Of course, if they issue securities, they have to comply with securities laws. If that's what Telegram is upset about, then I don't think they have much of a leg to stand on.
- cryptica 6y agoThis argument makes no sense at all. They never offered to sell the gold. It's more like they offered to sell a share of the gold mining venture. Where the token represents a share of the business. By that logic we should shut down every company in existence on the basis that there is uncertainty in their future. Especially now with the COVID-19, every airline company's survival is pure speculation; does that mean it should be illegal to buy shares of airline companies now? I don't care at all about TON at all. But in the context of corporate America, this is completely arbitrary.
- djrogers 6y agoAll of those companies that you’re talking about “Shutting down” are registered with the SEC, and follow SEC rules and guidelines for selling their securities. If telegram had done that with tan, this would not be an issue.
- cryptica 6y agoThe SEC is wrong and so is the notion of an accredited investor - The founding fathers would have been appalled at these ideas; they're twisted beyond what they could possibly have imagined at the time. These laws sound totally anti-constitutional. Doesn't resonate at all with the "Land of the free" idea. People are not free to start certain enterprises. They are not free to invest in certain enterprises. The only thing they are free to do is accept the fiat money which was printed out of thin air by their corporate masters. If you live in the US and you're not an accredited investor, I would recommend that you leave the country ASAP before the government puts chains on you.
- JumpCrisscross 6y ago> founding fathers would have been appalled at these ideas Look at export-import licensing norms, and the limits on incorporation, in the time of the founding fathers. Enterprise is, on average, far freer today. > laws sound totally anti-constitutional They’re not. Congress has vast Constitutional powers to regulate interstate commerce. It used these laws to curtail securities fraud in the 1930s. Those are the laws being violated here.
- cryptica 6y ago>> you don't even know if there's gold on that land, but you're promising your investors that there is I think it's very clear in this case that there was definitely gold on that land. The only thing which was unclear was how much gold... But is there such a thing as an enterprise without uncertainty? The only enterprise that exists without uncertainty in the US is ironically the Federal Reserve Bank. It is the only institution in the world which can print as much money as it wants and give it to whoever it wants. Who is running the real fraud?
- znpy 6y ago> We aren't allowed to sell people something that doesn't exist? Have you heard of this thing called Kickstarter?
- ooobit2 6y agoI get the comparison, but TON was intended to be an investment instrument. So, it'd be comparable if every Kickstarter was someone saying, "For your $5, I'll give you $7 if this works, and $3 if it doesn't."
- mc3 6y agoI think we can ethically sell things that don't exist to "sophisticated" investors - which is hard to define but probably based on net worth. Maybe limit the $ amount you can invest per person from "poor" investors to $1000 or something. But the question is, is it a scheme or an investment? That said people buying crazy options on sites like /r/wallstreetbets, or just betting on sports are in the same boat, so where to draw the line? I think it is better to err on the side of controlling such investment schemes though rather than let them run loose. The solution to the US controlling everything is to set up truly decentralised currencies like Bitcoin and keep a brand or controller out of that. Someone in the world can do this anonymously and it would be hard to shut down. Has anyone shut Bitcoin down yet?
- burnte 6y ago> Sound completely unfair? Government overstep? Yes, if I want to try to create a thing I reasonably believe will have value, and I'm honest about it, there should be little regulatory issue. Considering how many other cryptocurrencies there are, I REALLY don't understand at all why SEC cared about this one. There are far more shadier ones around than TON. > We aren't allowed to sell people something that doesn't exist? We do that every day. Commodities futures and stock options. Speculative investments in oil, gas, wind, tech, medicine, cars, etc. SOFTWARE. Not only that, we allow people to pay other people with promises they have the right to buy a thing that doesn't exist at a price we set today (unvested non-voting stock options), because we THINK it might be worth more later, although we fully acknowledge it may cease to exist, or even never exist at all (unvested options in a company that never goes public, or sells, and your shares vanish).
- dathinab 6y ago> I REALLY don't understand at all why SEC cared about this one. There are far more shadier ones around than TON. I guess it's because they believed that TON had the potential to actually become wide spread by it's Telegram integration. Which makes the regulators sound quite evil. But you can reformulate that as it having potential to cause large, wide spread amounts of damages. ;=)
- jrumbut 6y agoThe SEC is not preventing blockchain companies from selling securities, but only requiring that the same rules be followed that would allow me to sell shares of my gold mining outfit to the public. The problem isn't risk at all, like you said, plenty of securities sold to the public carry enormous risk. The regulations are in place not to prevent failed businesses but to ensure shareholders get their fair due when a business succeeds and have a basic set of facts when considering investments. Overstock, for instance, has been able to offer their securities on a blockchain. Their application is different from TON but it shows there is a path to doing this if you follow the rules.
- IAmGraydon 6y agoWhen did they outlaw speculation? The stock market? Selling people a future possibility, however likely or unlikely, has never been a crime.
- alexashka 6y agohttps://en.wikipedia.org/wiki/Ponzi_scheme https://en.wikipedia.org/wiki/Ponzi_scheme You should study a little history before making wild claims regarding 'always' or 'never'.
- IAmGraydon 6y agoYou should know enough about the topic at hand to realize the difference between it and a Ponzi scheme.
- egorf 6y agoThey are basically blocking USD competitors. This makes a lot of sense, doesn't it? Update: The SEC statement makes more sense than my original comment :)
- nikivi 6y agoLibra is allowed to exist though. Or I suppose it doesn't compete with USD as it will be tied to fiat?
- egorf 6y agoThis is only my guess, but it should be so much easier to control and regulate Facebook's product rather than Telegram's, right?
- ivalm 6y agoLibra is not selling rights to non-existent tokens. That’s why it’s not a security while TON is a security. No one banned TON, they just said that if you fundraise by sale of tokens then said tokens are securities. Which is a fairly straightforward truth.
- jokit 6y agoIt does from a short sighted, tyrannical, perspective.
- egorf 6y agoIt's not like I'm defending them. Just trying to understand the real reasoning behind this decision.
- lalaland1125 6y agoI highly recommend that you read the original SEC complaint. It lays out the reasoning quite clearly.
- wmf 6y agoOr you could say they are blocking obvious pump-and-dumps.
- lalaland1125 6y agoI highly recommend that people read the full SEC complaint: https://www.sec.gov/litigation/complaints/2019/comp-pr2019-212.pdf https://www.sec.gov/litigation/complaints/2019/comp-pr2019-2... It's pretty obvious that Telegram was simply planning to pump and then dump a bunch of worthless tokens on retail investors.
- ashtonkem 6y agoThat’s the norm with ICOs, I don’t know why anyone is shocked by that anymore.
- femto113 6y agoEven if you believe Telegram was competent and well intentioned the SEC's argument here seems clear and reasonable: Grams are securities because the Initial Purchasers and subsequent investors expect to profit from Telegram’s work ... Grams are not a currency because, among other things, there are not any products or services that can be purchased with Grams.
- thesz 6y ago"there are not any products or services that can be purchased with Grams" at the time of writing. And I believe omitting the time variable is the greatest omission in what you quoted.
- true_religion 6y agoNot really. Your security can bootstrap itself into being a currency, but until it does it’s still going to be treated like a security. You can of course negotiate with the SEC, but they would probably require guarantees, and a definite timeline of your plans... not just the promise of success at some indefinite future date.
- djrogers 6y agoThere is no time variable in play here, it’s either a currency at the time that it’s sold, or it’s not. If it’s not a currency at the time that it’s being sold, then it is being sold speculatively – which makes it a security.
- beckingz 6y agoSo do people get refunds...?
- ascendantlogic 6y agothis is a disingenuous post. The crux of the SEC effort against them is because they created this chain and token during the 2017 gold rush (actually in 2018 but obviously the 2017 bull run is what sparked the interest) and very clearly were trying to cash in. When you create what by all accounts is a security specifically for investment and asset appreciation but don't register it as a security with the SEC, they get a little unhappy. Reading back through some of the articles before this when the SEC intervened Telegram had raised 1.7 billion dollars off this. When you make a few billion off an unregistered security offering, people are going to sit up and take notice. Regardless of your feelings on the SEC, crypto, et al, it's pretty obvious why the SEC intervened and to see this eventual outcome.
- jrochkind1 6y ago> Reading back through some of the articles before this when the SEC intervened Telegram had raised 1.7 billion dollars off this. I think I understand the "more in sadness than in anger" tone of the post better now too. They did fine for themselves didn't they.
- ConsiderCrying 6y agoThey have to return the investments though,so I wouldn't say they "did fine". Back at square one, having spent a couple of years on a project.
- deleted 6y ago[deleted]
- wmf 6y agoNot really. They have to return $1.2B (either in cash or equity) and their burn rate is high. Now they have to find a new business model before the runway runs out.
- jandrese 6y agoSo they get to keep half a billion and never had to offer anything of value?
- mintplant 6y agoEleven paragraphs to say, "I'm taking my ball and going home!" When the SEC shuts down your unregistered securities offering, saying you saw the project as a literal gold mine is maybe a poor choice of analogy.
- macspoofing 6y agoIs KiK still fighting SEC? This can't be good news for them as well.
- hitekker 6y agoThe opening image looks like the start of a scam: https://telegra.ph/file/c6f281b62b5909d0c5bad.png https://telegra.ph/file/c6f281b62b5909d0c5bad.png Group of faceless people against a scenic vista, arms around and supporting each other, under the flag of the "product", facing a gold mine that apparently self-produces gold and a sun that just so happens to be shining light on all that wonderful gold... with a dog(?) chasing a golden butterfly. I've never used telegram before but I think the CEO should distance himself a bit more.
- speedgoose 6y agoThis is good for the environment.
- wmf 6y agoWasn't TON using proof of stake?
- rwmj 6y agoI've found David Gerard's periodic updates to be useful (on this and other cryptocurrency nonsense/scams/etc). His latest one about Telegram is: https://davidgerard.co.uk/blockchain/2020/04/14/news-cooking-mama-and-blockchain-the-halvening-and-bitcoin-cash-simple-assurance-of-future-litigation-kraken-craig-wright/ https://davidgerard.co.uk/blockchain/2020/04/14/news-cooking... Link to the "telegram" tag on his blog: https://davidgerard.co.uk/blockchain/tag/telegram/ https://davidgerard.co.uk/blockchain/tag/telegram/
- owenversteeg 6y agoLooks like the Matt Levine of crypto, even down to the "Things happen" section.
- rwmj 6y agoHe's definitely copying Matt Levine's style.
- davidgerard 6y agoI blatantly am! Posting has slowed lately because I'm finding myself busier during lockdown - loved one is ill (not Covid thankfully), so the day is: day job, do all the house stuff, take care of kid and wife, collapse and sleep, repeat - but I gotta write something about the end of the TON story ...
- davidgerard 6y agothis is absolutely the highest praise, thank you
- davidgerard 6y agohere's my piece on this, if a day late https://davidgerard.co.uk/blockchain/2020/05/14/telegram-gives-up-on-the-telegram-open-network/ https://davidgerard.co.uk/blockchain/2020/05/14/telegram-giv...
- AnonC 6y agoI wonder how Telegram will subsist and how it’s going to generate money for the longer term. Since it stores all messages and media by default (except secret chats) on its cloud, the infrastructure costs will keep going up at some pace with time. It was only a few weeks ago that Telegram announced that it has 400 million monthly active users. How long can Pavel Durov’s wealth keep it alive and how much of his wealth will he continue to commit to the platform as time passes? The platform is surely synonymous with him (at least from his perspective), and there are millions of people who need it and trust it (it’s the only app that large groups of protestors in Hong Kong could safely use).
- miohtama 6y agoThey will convert TON investments to equity investments. Which is probably what Silicon Valley VCs wanted in the first place. Now Durov holds 100% of equity. Think WhatsApp back in a day before Facebook acquisition.
- eitland 6y agoAs a long time Telegram fan - albeit less than before - I'm happy to see this go: Why do everyone have to try to create another blockchain? Why can't companies just be honest enough to either name a price up front or make a freemium model or something? Hopefully this will cause them to reconsider payments like old WhatsApp or something else that aligns with the interests of the users? Edit: add second part of a broken sentence. Also: the niche that WhatsApp used to hold (paid, reasonable price, good ux, no ads or spying) still isn't too crowded. Signal is important and I am happy to recommend it but there's a lot of room still for others who want to enter the small communities/group-of-friends messaging space. The best alternatives I have found so far are: MeWe (pretty close to Google+, but with a business model that isn't based on selling data or ads), Telegram and of course still WhatsApp if you can stomach it.
- wmf 6y agoThe Durov brothers got screwed by the Russian government so I can imagine why unregulated money appeals to them. If they created some kind of PayPal 3.0 in their minds they would probably just be waiting to be robbed by some government(s).
- pjc50 6y ago> Why do everyone have to try to create another blockchain? Because people will give you a billion dollars for it.
- eitland 6y ago> Because people will give you a billion dollars for it. Hopefully we see the end of that now. Or at least the beginning of the end.
- ccktlmazeltov 6y agoWhy are you a long time Telegran fan considering that their end-to-end encryption sucks in comparison to WhatsApp, Signal, et al
- dmitriid 6y ago
- tomc1985 6y agoThe graphic at the top and the first few paragraphs come off as extremely patronizing, if not propagandistic. Then he goes off on a rant about sovereignty to cover for TON's lack of legitimacy. Not a good look for Telegram, and good riddance to TON. I realize this blockchain garbage is probably never going to die but it is good to see the real world doing what it does best.
- red_admiral 6y ago> Unfortunately, we – the 96% of the world’s population living elsewhere – are dependent on decision makers elected by the 4% living in the US. Calling your bluff on this one. Other world powers are available if that's really your argument. It turns out that if you want customers in the US, then yes you have to follow US law.
- imglorp 6y agoThis seems like one of those situations where the world benefits from one country doing the homework and moving to protect its citizens. I mean, if another country wants to okay pump and dump scam coins, or bogus medicine, or unsafe cars, they're free to do that. Otherwise, others might as well benefit from SEC, FDA, and NHTSA results unless overridden locally, no? Sure, US agencies not perfect, captured even sometimes, but pretty sure tiny Elbonia doesn't have the resources to vet securities, drugs, or cars.
- manquer 6y agoWhile broadly true, other countries regulators need to be active and keep the American regulators in check. The entire episode with FAA and Boeing 737-MAX makes it clear that while Ethiopian regulator can not do airworthiness certification of such a complex plane they can definitely ground the fleet faster than FAA wanted to do. It is unlikely that FAA would have grounded the fleet until all other major bodies had done so and put it under a lot of pressure to also do so.
- sub7 6y agoJust wait until governments actually start attacking cryptocurrencies. They're dumb and slow but when they finally catch on, the game is up. All these stupid glorified link lists have never been backed by anything other than speculation and eventually market forces will always win.
- vageli 6y ago> Just wait until governments actually start attacking cryptocurrencies. > eventually market forces will always win. How is government intervention an example of market forces winning out?
- sub7 6y agoRegulation is an essential market force. Level playing fields and all that. It often over extends, misses the target and/or doesn't address root causes which is why you hear a lot of hate. When enough people in the right positions become incentivized to act, you'll see change.
- junaru 6y ago> blockchain platform called TON and a cryptocurrency we were going to name Gram And no one in marketing said anything about naming your platform and curency after units of mass. How come no one raised the SEO issue?
- wmf 6y agoTelegram has hundreds of millions of existing users; they don't need SEO.
- chris_engel 6y agoSo... why not just leave that feature out of the US versions in the app store and everything is fine. Or am I missing something?
- JumpCrisscross 6y ago> am I missing something? Telegram sold boatloads of these to American institutional investors.
- kick 6y agoPerhaps even more paradoxically, 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.
- vageli 6y ago> Perhaps even more paradoxically, 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. Why would telegram ask the court to clarify that the injunction applied globally if telegram believed the court did not have jurisdiction to enforce such a global order? > In the ongoing enforcement action SEC v. Telegram Group, Inc. and TON Issuer, Inc., Judge P. Kevin Castel has denied an application by Telegram and TON Issuer (collectively, “Telegram”) that, if granted, would have allowed Telegram to distribute its cryptocurrency, Grams, to non-US based purchasers. Telegram’s application asked the court to limit the scope of the court’s recently issued preliminary injunction. The injunction prohibited Telegram from distributing Grams, reasoning that the initial purchasers would likely resell the Grams in a public market that could include US persons. Telegram sought clarification that the order did not prohibit the distribution to foreign initial purchasers. The court rejected Telegram’s request, reiterating its finding that Telegram’s distribution, even if made only to foreign initial purchasers, would likely result in a distribution back to the US. https://www.dlapiper.com/en/us/insights/publications/2020/04/court-confirms-telegram-injunction-covers-non-us-purchasers/ https://www.dlapiper.com/en/us/insights/publications/2020/04...
- heliodor 6y agoAdmins, please fix this clickbait title. Compare to the TechCrunch story that's titled "Telegram abandons its TON blockchain platform".
- codewithcheese 6y agoOK so they built this great blockchain and you can't continue but where is the link to the source? [0] https://test.ton.org/ https://test.ton.org/
- thefounder 6y agoMaybe I don't get it but the gov didn't ban TON. It banned the sale of said tokens. Nothing stops them from further developing the tech with VC money.
- wmf 6y agoThat's how you know it's not about the technology; it's all about getting rich quick. Once that has been taken away they lost interest in developing TON.
- schmichael 6y agoI think it's safe to say that without fungible tokens (Grams), the blockchain itself (TON) isn't very interesting (despite what they want you to believe).
- PeterisP 6y agoFurthermore, it only banned the sale of said tokens to americans and in USA - if TON is so great and certainly profitable, I'm sure there are lots of wealthy Saudi or Chinese investors that would be glad to invest. It's just that the "greater fool" theory of investment fails if everyone knows that they won't be able to unload these securities to unsophisticated mass market in USA.
- Animats 6y agoWhat do they have to hide? Filing for a US initial public offering requires much writing and some audits, but it's not inherently difficult. Thousands of marginal companies have done IPOs. That's where penny stocks come from. The SEC doesn't evaluate your business model. All they insist is that you don't lie. Now, if you want to list on an exchange, have your IPO underwritten by a major financial firm, and get institutional investors to buy your stock, there's more to do. But those aren't SEC requirements. You can IPO without them and peddle your own shares. [1] https://www.sec.gov/rules/other/2018/34-83723.pdf https://www.sec.gov/rules/other/2018/34-83723.pdf
- smsm42 6y agoWhen reading this article, I got an impression that US government banned Telegram from issuing certain securities, but after reading comments and links I come to the conclusion it's not the case and actually US government just said "it's a security, so you have to follow our securities procedures". Granted, those are not very fun, but that's not what Telegram complaint is - it looks like they tried to sneak a fast one and it didn't work. Well done Telegram marketing for temporarily misleading me, I guess.
- dathinab 6y agoYes, their article is very one sided. Through why they ended up in the situations they did why other didn't is a bit more complex then what either you or they wrote I think.
- mleonhard 6y agoIf they really cared about decentralization, they would still release the protocol and software even if they cannot profit from it. I'm tired of greedy cryptocurrency advocates putting on airs of social responsibility.
- wmf 6y agoIt's on Github; did you look for it?
- dnprock 6y ago> Imagine that several people put their money together to build a gold mine. This is what's wrong about what they're trying to do. TON is selling tokenized access to the supposed gold mine. The gold is the TON product which is just a chat software. I'm glad regulators ban it. It's a scam. You need to look at the gold, the business. The BNB Binance token could be a better token. At least, their business has better prospect. I would stay away from these tokens. They're just security masquerading as crypto. They're likely scams.
- noxer 6y agoTo all the people says that they should have just followed security laws, you don't understand the purpose of TON and GRAM. It CAN NOT work if it is a security. The Idea was that Telegram user have a wallet and can store/send GRAMs to each-other Donate/tip and buy stuff. This is not possible/allowed with securities. You can only buy/sell securities form/to regulated exchanges. It completely destroys it's whole use-case. Anyway they could still do it with some kind of distributed token generation, similar to mining so tokens are generated by the users and not sold. But this obviously would not make the investors happy because they get nothing then.
- ivalm 6y agoThen don’t use a metaphor of a gold mine. If you compare TON to shares of a gold mine (what they did in the linked blog) then clearly it is a security.
- noxer 6y agoOfc it is a security. I just pointed out why they tried to avoid it. Not because they where to lazy to do the paperwork like half the people in here suggest.
- imsesaok 6y agoso you're saying "it's a security, but it shouldn't be treated as security because security law forbids <enter activity here>", which means you want to break the law. they tried to break the law so it's not allowed. i don't see a problem here
- noxer 6y agoNo, absolutely not. I made none if these statements at all. Read it again pls.
- papreclip 6y agojust another crypto pyramid scheme
- ivalm 6y agoIf you sell shares in a gold mine it is a security. All SEC wanted is for TON to be treated like a security, which is exactly what shares in a gold mine are.
- mirimir 6y agoTheir first mistake was being subject to US jurisdiction.
- mirimir 6y agoNo, that's wrong. It seems like they didn't get good legal advice, and/or changed their business plan without ongoing legal advice. That is, if they knew that they'd be violating US securities and/or money laundering law, they should have avoided US jurisdiction.
- moonbug 6y ago...and nothing of value was lost.
- krick 6y agoI don't exactly understand how US court could forbid Telegram anything. Yeah-yeah, there is an "explanation", but I have hard time buying into it. USA can have far more power than it should, but by no means it's all-powerful, there is a ton of shit in the world that USA may not like, but it exists anyway and even manages to have USA-based customers through some shady as fuck, absolutely nonsensical, but still somehow legal schemes. So I'm reading this as "our plan has failed for whatever reason, so now we are getting rid of it, while pretending that it is a very hard decision for us and somebody else entirely is to blame".
- freewizard 6y agoI like Telegram as an app and service but have reasonable doubt of how it’s gonna be sustainable. WhatsApp had 400m MAU and $1m monthly cost in 2013 before acquisition, Telegram reached same MAU recently and avg cost is 4x or more. Founder had about $300m when forced to exit VK. If my math is right, he can’t really keep running this all free much longer.
- shermanmccoy 6y agoIt was "banned" because they did not register the offering, not because the "people did not want the gold for themselves", in their childish analogy.
- Hickfang 6y agoConsidering that conventional currencies represent real goods, what thing of value is represented by these crypto currencies.
- zkid18 6y agoWhy Durov have decided to subject to US jurisdiction? Afaik many ICO had put restrictions on accessing tokens by US citizens?
- dblank9 6y agoVery odd outcome considering they didn't do much different from Ethereum or EOS, both of which seem fine nowadays. I think it would have been different if they were to release their coin first, ask questions later.
- mD5pPxMcS6fVWKE 6y agoThe key word is "our" in "our best engineers". If it is "theirs", it is not decentralized, it does belong to them. It is faster and more efficient exactly because of that. This is the same mistake all private blockchain creators do, they don't understand the connection between mining and decentralization. Bitcoin and Ethereum are decentralized only because of highly inefficient mining. The key difference between decentralized and centralized is a judge can jail a person (durov) or bankrupt a company (telegram), but she can't do any of these things to a protocol (bitcoin).