US-Based Investors Forced Out Of Telegram Crypto Project
Regulatory hurdles have pushed Telegram to buy out US-based investors.
The Telegram Open Network (TON) launch was delayed by another year after the company was unable to comply with the requirements set before the deadline on April 30.
As part of their agreement with investors, Telegram promised that it would offer a 72% refund on every investment if the network was not launched by the due date. While this offer is still on the table, the company is also offering a 110% payment on the original amount of any investment that is extended to April 2021.
In a follow-up letter to their investors last Monday, Telegram added that only investors outside of the United States are eligible to extend their investments; those based within the US will have only one option, which is to accept the refund.
Additionally, the company is refusing to make these payments in any digital currency due to its position with regulators.
“We have made the difficult decision not to pursue an option involving grams or another cryptocurrency due to its uncertain reception from the relevant regulators,” Telegram explained in its message to investors.
The London-based organization’s decision to single out US investors is due to the numerous regulatory hurdles it has encountered within the country. The United States Security and Exchange Commission (USEC) filed a lawsuit against Telegram in the Southern District of New York in October 2019, and managed to procure an emergency restraining order, which delayed the Network’s launch.
The TON was originally scheduled to go live in that same month; however, their launch was first moved to April 2020. It has now been delayed a second time and is rescheduled to go online by April 2021.
Just this April, Telegram was also denied the right to distribute TON’s native cryptocurrency, called Gram, to non-US investors until the court would arrive at a decision in their case.
It remains unclear as to whether Telegram will push through with work on the blockchain project, as the distribution of Gram tokens remains unstable.
Establishing a foothold in the US has been a struggle for other cryptocurrencies as well; aside from the communication company, Facebook’s Libra Project is also under heavy criticism and scrutiny from regulators.