Gram (cryptocurrency)

Gram is a cryptocurrency that Telegram has planned to create.

It was expected that Gram will be used by users of the Telegram Open Network (TON) blockchain platform as a means of mutual settlements for making online payments. At the same time, a fee will be charged for transferring money between users' wallets. At the same time, the currency will be used on external exchanges and used inside the Telegram application.

2020

Cryptomama from the US financial authorities made a mistake to ban Durov's cryptocurrencies

Commissioner of the U.S. Securities and Exchange Commission (SEC) Hester Pearce (Hester M. Peirce) called the ban on release of the Gram cryptocurrency of Pavel Durov and start of its TON blockchain platform a mistake. She stated this at the Blockchain Association Singapore conference, and a transcript of her speech was published on the SEC^[1] website^[2].

It should be noted that Hester Pierce is known for her friendly attitude to digital assets, for which, according to the CoinDesk portal, she received the nickname "Crypto Mom." For example, speaking at the New York Summit on Legal Compliance in the DACOM cryptocurrency industry in September 2019, she said that modern cryptocurrencies have an important accumulation function, and that they can be considered a transactional mechanism.

Speaking at the Blockchain Association Singapore event, Hester Pierce said: "The decision was an unsatisfactory conclusion to the enforcement action, which I did not support from the very beginning. Telegram developed a functioning network, and sought to comply with the requirements of federal securities laws when raising funds to create its project, and also actively collaborated with SEC employees. "

According to Pierce, the Safe Agreement for Future Tokens (SAFT) model selected by TON developers was supposed to protect them from any possible violations, somehow related to securities. However, according to Pierce, the SEC decided not to consider this and was able to convince the court that Gram should be considered securities.

SAFT is a compromise model for raising funds. It is fully compatible with the legal rules of the US stock market, as well as with the tax laws and requirements of the financial services sector of this country. The authors of the SAFT model were Marco Santori from the American law firm Cooley LLP and Jesse Clayburgh from Protocol Labs, an IT research and development company.

Telegram cryptocurrency ban

At the end of March 2020, District Judge Kevin Castel of the Southern District of New York granted the petition of the US Securities and Exchange Commission (SEC), banning the release of Gram cryptocurrency.

According to the judge's ruling, cryptocurrency blockchain the project Telegram Open Network (TON) is a security, and the SEC has evidence that Telegram was engaged in the sale of unregistered securities in 2018 by selling Gram tokens. Telegram sold 2.9 billion Gram 175 units to buyers worth $1.7 billion.

District Judge Kevin Castel of the Southern District of New York granted the petition of the US Securities and Exchange Commission (SEC), banning the release of Gram cryptocurrency

US authorities say primary investors purchased Gram for sale in the secondary market for the purpose of earnings.

The SEC asked the court to prohibit the transfer of Gram tokens to first investors and insisted that it was a security, but its issue and sale in 2018 to investors took place without prior registration, as prescribed by US securities law. The court agreed with the SEC's arguments, citing in its decision the Howie test - the criteria developed by the US Supreme Court in 1946 for assigning operations to investment contracts.

Our emergency actions are aimed at preventing Telegram from flooding the US markets with digital tokens, which, we claim, were sold illegally, "said Stephanie Avakyan, co-chairman of the SEC enforcement department.

Telegram representatives in court could not present convincing arguments indicating the lack of the need to conduct preliminary registration before selling tokens to first investors.

The head of the cryptoinvestment company Hash CIB, Yakov Barinsky, said that about 10 investors are going to return money from the TON project. The financier believes that the current proposals are more profitable than in October 2019, given the problems in the world market.^[3]

Despite the fact that Durov insisted that after the launch of TON, he would not control the cost of Gram, according to SEC documents, the subsidiary of Telegram TON Foundation was going to influence the price of Gram, buying them out of the market and creating additional demand if their price fell below $1.81 per token. Thus, Telegram was going to guarantee the profit from reselling tokens to the first buyers.

According to the materials of the offer, the Durov brothers reserved the right to distribute the collected investments for TON and Telegram. The documents also cite the words of a lawyer who stated that the company reserved the right to redistribute any unspent revenue between shareholders, that is, the Durov brothers. The documents also note that the messenger is not monetized in any way, so that revenue from token sales in 2018 became their main source of income.

Also, according to the SEC, after the launch of TON, the blockchain will be inextricably connected with the state of Durov. So the most valuable asset will be the TON reserve, consisting of 28% of all issued tokens.

In addition, 5% of all tokens were reserved for developers (1% would go to Durov, and 4% to the rest of the Telegram team)

From January 2018 to January 2020, the company spent $405 million on the development of TON -  about  24% of the amount that Telegram received from investors for tokens. At the first stage of private placement, the cost of one Gram was approximately $0.38 (approximately 2.25 million tokens were sold to 81 buyers for $850 million, while $385.5 million was for 34 US citizens). At the second stage - $1.33 (700 million tokens were sold for $850 million to 94 buyers, $39 million were raised from 5 US citizens). In total, 2.9 billion Gram rights were sold, which amounted to 58% of all Gram planned for release.

The sale of tokens in 2018 covered the costs of supporting the work of the messenger by $190 million in 2019 and $220 million in 2020.

2019

US sales ban

In October 2019, the US Securities and Exchange Commission (SEC) through the court obtained a ban on the release of Gram. The reason was that Telegram Group and TON Issuer did not register the sale of cryptocurrency, although they were obliged to do so in accordance with the US Securities Act of 1933, the regulator said.

The defendants did not provide investors with data on business operations with Gram and Telegram, condition, risk factors and management - this is a requirement of securities legislation, said Stephanie Avakyan, co-chairman of the SEC enforcement department.

US authorities banned the sale of Telegram cryptocurrency

Our emergency measures are aimed at preventing Telegram from flooding the American market with digital tokens. We claim that they were illegally sold to [investors], the SEC said.

The commission's lawsuit faces Telegram Group and TON Issuer with a complete ban on the release of cryptocurrency, fines and other sanctions.

By October 11, 2019, the initial placement of Gram in the American market took place, 171 investors acquired tokens, 39 of which were from the United States. At the same time, tokens were sold at a lower price - 37 cents apiece. At the second stage, it will increase to $1.33, and at launch - to $3.62. Telegram Group and TON Issuer managed to raise $1.7 billion.

Telegram promised to transfer tokens to buyers no later than October 31, 2019, after this date, the first buyers will be able to sell these tools in the American market.

Pavel Durov's team promised investors to return the invested money if it does not launch the TON blockchain network by October 31, 2019.

Gram's purchase agreement did not include the company's financial history, information about its ability to generate profits. Buyers will not receive information that will allow them to decide whether to invest in Gram. They will also not have information about what remuneration the Durov brothers will receive as a result of the ICO.^[4]

Central Bank: the launch of the Telegram cryptocurrency will spawn a wave of fraud and financial pyramids

In mid-September 2019, the Central Bank of the Russian Federation warned that the  launch of Facebook and Telegram cryptocurrencies would generate a wave of fraud and financial pyramids. More details here.

Derivative contract on GRAM with credit leverage on Xena Exchange

On February 7, 2019, the Xena Exchange platform for trading digital assets announced the launch of a cryptocurrency derivative on a GRAM token with a credit shoulder. This is a significant step towards GRAM liquidity, since investors in the Telegram TON project will be able to trade derivatives until the actual release of GRAM tokens on exchanges. More details here.

2018: Plans for the release of 5 billion tokens during the ICO

In January 2018, Telegram announced plans to release 5 billion Gram as part of the ICO. Of these, 2.2 billion tokens (44%) will be put up for sale. Of the remaining 2.6 million tokens (52%), the company will remain at the disposal of the company as a stabilization fund, in order to prevent possible speculation on the course. Another 200 million tokens (4%) are reserved for messenger developers. At the same time, starting in 2020, Telegram expects to additionally release 100 million Gram annually, reports Zerich.com.

The very first token is planned to be sold for 10 cents. The cost of each next will increase by one billion dollars. Thus, the last Gram put up for sale will cost the buyer $2 30 cents. If everything is implemented as planned, then according to the results of the upcoming ICO, Telegram will be able to become a transnational corporation, free from pressure from the authorities of any state.

According to TechCrunch, the messenger plans to raise $500 million through the preliminary ICO to launch its own blockchain platform and cryptocurrency for the purpose of the messenger. At the same time, the potential total value of tokens, according to preliminary estimates, will be from $3 to $5 billion.