Business

Erik Gibbs

Sham company attempts to capitalize on Telegram’s ICO

Will the real Telegram please stand up? A company called the Telegram Open Network Limited (TONL) purported to be started by the real founder of Telegram, Pavel Durov, has been operating since the end of February, and is capitalizing on the fame surrounding the social media platform, which is popular with cryptocurrency developers and investors.

TONL claimed to have raised over $1.7 billion for the Initial Coin Offering (ICO) of its Telegram Open Network and says that it will offer encrypted browsing platforms, private Virtual Private Networks (VPNs) and secure file storage. It will also supposedly offer micropayment services, peer-to-peer payment capabilities, and services for decentralized apps and browsing. The problem is, the company doesn’t actually exist.

The company is registered in the UK, which has very lax regulations for how someone can register a company. For $20 and an Internet connection, and you’re in—applicants only have to confirm their details with no regulatory oversight. This passive attitude allowed the person or persons behind TONL to register the company and begin its deceptive practices.

Telegram—the real one—is running an ICO that last week brought in around $850 million. This is on top of another $850 million the company raised in February. It would appear that TONL is successfully capitalizing on Telegram’s current position to syphon funds away from the company, which Telegram vehemently denies being a part of.

In a Twitter post on April 6, The Calvert Journal tweeted, “[email protected] founder Pavel Durov has registered a UK company worth £800 million- revealing his new British citizenship in the process.” It didn’t take long for a response from Telegram’s official account, which read, “This entry is fake. Most likely a prank or scam, no such company was registered by Pavel.”

In addition to the public denial by Telegram, there were a couple of clues that lead to the company being proven a sham. If it had, in fact raised over $1 billion, it would have almost immediately been the target of UK authorities. It also listed Durov as the director, founder and secretary of the company and describes him as a British citizen. Durov became a citizen of St. Kitts and Nevis when he gave a $250,000 donation to the sugar industry on the island nation.

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