Telegram founder, Pavel Durov, has been interrogated by a court in Paris over his role in the unsuccessful launch of the company's cryptocurrency project, the Gram token.
In a recent development, Pavel Durov, the founder of the renowned messaging app Telegram, has been questioned by a Paris court. This interrogation is centered around the controversial and unsuccessful launch of Telegram’s cryptocurrency, the Gram token.
Background on Telegram’s Cryptocurrency Project
Telegram, which is famed for its encrypted messaging service, decided to venture into the cryptocurrency space in 2017. The company sought to launch its own digital token, dubbed the Gram. The ambitious project aimed to create a new online economy encompassing not just payments, but also file storage, censorship-proof browsing, and even its own App Store.
The company raised a massive $1.7 billion in two private initial coin offering (ICO) rounds to fund the project, making it one of the largest crowdfunding campaigns in the history of cryptocurrencies.
Related: SEC Orders BitClave to Reimburse ICO Investors
The Legal Battle
However, the project ran into legal issues as the U.S. Securities and Exchange Commission (SEC) considered the ICO a violation of its regulations. The SEC claimed that the ICO constituted an unregistered securities sale, leading Telegram to halt the project and return funds to investors.
In the midst of this legal battle, Durov was summoned to Paris to testify in court about the ICO and his role in it. The interrogation is part of a lawsuit filed by former investors in the Telegram ICO, who claim they lost a significant amount of money following the project’s cancellation.
Related: Questions of Guilt and Responsibility: Why Pavel Durov and Telegram?
Durov’s Testimony
Durov testified for over six hours, responding to questions about the ICO, the return of funds to investors, and the decision to cancel the project. However, no information about the content of his testimony or the potential outcome of the lawsuit has been released.
This is not the first time Durov has been under scrutiny because of the Gram token. He has faced questioning in the United States in relation to the SEC’s charges against Telegram. Despite the legal challenges, Durov has consistently maintained that the Gram token was not a security and that the SEC’s classification was incorrect.
Aftermath of the Gram Token Project
The shelving of the Gram token project has left a lasting impact on Telegram and its users. Despite the setback, Telegram continues to operate successfully, boasting over 500 million active users.
Related: Elon Musk and Sam Altman Contemplate ICO for OpenAI: Legal Documents Revealed
However, the company has had to pivot its focus away from blockchain and cryptocurrency. Instead, it is working on improving its core messaging service and exploring other avenues for growth.
The Gram token debacle serves as a cautionary tale for other technology companies thinking about launching their own digital currencies. It underscores the importance of regulatory compliance and the potential consequences of disregarding financial regulations.
As the legal proceedings unfold, the global tech and crypto community will be watching closely to see the outcome of this case and its implications for similar projects.
John is a renowned journalist and blockchain enthusiast with over 12 years of experience covering global financial trends and cryptocurrency markets. His sharp insights and ability to break down complex topics make him a cornerstone of finandcrypto.com. Known for his analytical skills, John is passionate about delivering content that empowers the crypto community.
