Facebook’s crypto project Libra might soon have to share some of its spotlight with another big social network Telegram, that is charging ahead with its own cryptocurrency as it plans on launching it sooner than initially anticipated.
Telegram, the cloud-based instant messaging and voice over IP service, was created by Pavel Durov, who fled Russia after some disagreements with the government. The network is famous for providing an easy way to send out encrypted messages between mobile devices, making it a solid competition for Facebook owned messaging service WhatsApp.
While Facebook’s master plan for its cryptocurrency seem to have hit a wall of regulatory issues, Telegram is hastily moving towards introducing its native token Gram, to the market. Recent reports reveal that the social network platform has told its investors about it plans regarding the launch of the Gram tokens.
Reportedly 3 of the investors shared that Telegram will be sending out the first batch of Gram tokens within the coming 2 months, which is ahead of its scheduled release date of Oct. 31. However they did so under the condition of staying anonymous, because they were bound by the nondisclosure agreement they had signed with Telegram.
The unreleased Gram tokens went on sale earlier in July on the cryptocurrency exchange Liquid, reportedly at a price 3 times of its private placement. As per reports, the Gram token will operate with a decentralized structure that is similar to the famous bitcoin (BTC), which means that Telegram will not have control over the whereabouts and movement of the tokens and neither will they know how the Gram move around.
Investors further revealed that the platform also has big plans for its Gram digital wallets, which according to them, will be available for the 200 million to 300 million global users of Telegram’s messaging application.
Both Facebook and Telegram’s idea of tokens share similar aims and ambitions, Libra aims to become a simple cryptocurrency that is global and accessible to people across the globe. Echoing Libra, the Gram token aims at becoming the new online currency all the while, providing people a way to move their money geographically anywhere.
While they do seem to share similarities, they have their fare share of differences that set them apart. Where Facebook’s Libra is said to backed by a basket of currencies in order to avoid price volatility, Telegram’s Gram on the other hand, will be backed by nothing, much like bitcoin, and will gain or lose its value constantly.
Furthermore, the two platforms have stuck to different approaches regarding their crypto endeavors. Where Facebook publicly released plans for its digital money seemingly before the token was fully ready, Telegram chose a more private route. However, it is likely that won’t stand to make a difference when it comes to the regulators. If anything, Telegram’s privacy could welcome more questions from the regulator upon making its tokens public.
Regulatory bodies will be a challenge for both the platforms, as their plans to enter the financial and digital asset space were met with skepticism. While Facebook has been on the grill due to its sketchy history with customer privacy, Telegram’s challenge is that its notoriously famous amongst terrorists, government dissidents and protesters, which obviously raises red flags.
Anyone trying to build this type of token system has to be careful on any number of levels with regulator. I suspect that regulators will take a very close look at this offering.
Shared Richard Levin, who specializes in cryptocurrencies law at the law firm Polsinelli, with The New York Times.
We’ll witness soon enough just how Telegram fares in front of the regulators as compared to Facebook since Telegram is fulfilling its legal promise of delivering Grams to its investor before its due time,
According to reports, some holders of the Gram tokens will be able to sell them on cryptocurrency exchanges almost immediately. But before the coins are officially launched, Telegram has revealed that a test version of the Gram network shall be released. As per the investors, the test network will be released within the next week or two.