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TON’s Private Accredited Investors’ names disclosed by Telegram CEO Paval Durov

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Jayashree Ingle Follow


Feb, 14 2020

Feb, 14 2020

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In continuation of the legal scuffle between Messenger services Telegram against the Securities and Exchange Commission (SEC), names of the private accredited investors who participated in the company's million-dollar token sale have been revealed on 27 January.

During the deposition of Telegram CEO, Paval Durov, he revealed certain high profile names of the investors in the TON project. The list includes Mickey Malka of Rabbit Capital who is known for his previous role in the Bitcoin Foundation.

Another name is David Yang who is the venture capitalist and member of the Silicon Valley-based group called Band of Angels.

Other prominent names include several VC firms including the Fortress investment group, Draper Dragon, Kleiner Perkins, Dragoneer, Repoint, DRW Holdings.

The names of the investors’ matters a lot in this case as Durov emphasized that Malka’s blockchain involvement and his experience in the process of validation is significant and that Malka was closely affiliated with the parties that are well versed with the validation process. Other accredited individuals related to VC firms have submitted their testimony which clearly indicates that they have purchased the token for standard trading related reasons.

In the Light of the SEC Allegations

The SEC allegations against the Telegram revolve around the sale of its multi-billion-dollar tokens to the general public which might have violated securities regulations.

Recently the Blockchain Association which includes major crypto-firms like Ripple, Coinbase, Ox, Circle, etc. justified Telegram by stating that SEC’s token sale was doomed for sophisticated accredited private investors and not for the general public. And that the purchase agreements offered by the Telegram were fully in compliance with the existing securities rule of SEC.

This argument clearly indicated that the Telegram’s token sale was limited to accredited investors and not to the general public, and thus the SEC shouldn’t enforce the regulations deliberated to protect the public interests.

The arguments further signified that under the ‘Regulation D exemption’, raising the capital from the private accredited investors is justifiable and compliant under SEC regulations.

Apart from this argument, the question of whether Telegram has properly invested the raised capital for blockchain development or not is crucial as well. Telegram has decided to make major steps towards blockchain development as a response to the SECs action.

The background story of Telegram vs. SEC

Telegram has been developing its Blockchain platform dubbed as Telegram Open Network (TON) since 2018. Telegram raised $1.7 billion capital through the sale of Gram token to the accredited investors in March 2018. The much-speculated platform was scheduled to be launched on 31st October 2019. But before this launch, the SEC filed a lawsuit against Telegram suspending its sale of Gram tokens to the US investors.

Since then, rounds of arguments from both the parties making the headlines across every medium from the crypto industry. The actual hearing is scheduled for February 18, 2020.

We tried to access the expert’s perspective on this matter about the potential consequences of this case on the entire crypto industry.

Pramod Attarde, CEO of Crypto Asset Rating (CAR), expounded that even if the issuer of any tokens is as big as Telegram, it could hamper the interest of the general investors. So it is always advisable to invest in legally compliant tokens rather than inviting risks. Investors should also evaluate the vision of the issuer company.

The ongoing case is a kind of lesson to the investors that they should invest in the SEC compliant companies to avoid further complications and loss of investments.

They can refer to the rating of the crypto assets offered by firms such as Crypto Asset Rating (CAR), before making any investment decision.


As the case is progressing further, other crucial points will be discussed eventually but it is apparent that the legal battle has pushed the blockchain project of Telegram towards more uncertainty.

#Telegram #CryptoAssetRating #SEC #blockchain #Gram #PavalDurov #RegulationD

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Jayashree Ingle

CBW - External Analyst


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