TON Launches under Different Name with TON Crystal Token Trying to Beat SEC

UTC by Teuta Franjkovic · 4 min read
TON Launches under Different Name with TON Crystal Token Trying to Beat SEC
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Free TON and TON Crystal tokens are to be launched today by the decentralized community, but it is said that Telegram needs to leave the project.

TON developers, some major PoS validators, and community enthusiasts revealed they decided to launch Free TON powered by the native token TON Crystal, it is believed that it will help to overcome all teh issues with the SEC. The protocol was built by Dr. Nikolai Durov in cooperation with the Telegram team. As Gram token had great problems in trying to win a court case against the SEC, (and it obviously didn’t succeed), the community decided to step in.

Amid other participants, TON Labs and are featured as the launch parties. The underwriters of the declaration accepted the contribution of the Telegram team together with Durov and invited them to contribute to the further development of the network. However, the participants refused to comply with the SEC or U.S. court rulings believing that the network with its tokens (Gram or TON Crystal), when launched, will benefit everybody.

The declaration says:

“We are grateful for Nikolai Durov’s to the TON protocol and wish him to continue developing it as part of a wider community effort.”

The idea is that free TON is launched in several phases on the behalf of assuring the continuous advancement of the protocol including the initial developers and mass adoption. The signers said to focus on enabling maximum possible decentralization in governance, software development, and validation.

Declaration reads:

“Since we believe in freedom of speech, in information sharing, and in free software, we have decided to give the power back to the community. The TON protocol represents an opportunity to create a massively scalable network benefiting hundreds of millions of people.”

Three Phases to Start With

Phase one is called “Raging Bull” and will emphasize manual changes in the network configuration and SMV contracts. The code will feature a decentralization time bomb. It will count down the time to the moment when the developers lose any possibility to change the configuration.

Phase two, or so-called “Rumble Fish” will begin at the time when the decentralization bomb activates. The network will then be controlled by validators.

Phase three is dubbed “Fight Club.” By then, the network will have enough validators and pools, and TON will become fully decentralized. SVM voting will become automatic, and smart contracts will frequently distribute coins among new users.

Coins from the genesis block will be distributed among so-called Giver contracts without being involved in voting or staking. Their only direction is automatic distribution. They will have 85% of all coins to incentivize first users and partners to promote TON among their user base.

All decisions on coin distribution via Giver contracts will be made through voting by TON holders.

SEC Forbid Telegram to Deal with Gram Tokens, TON Crystal Comes Instead

On October 17th, Telegram told SEC that Gram tokens aren’t securities and asked the court to call on the regulator’s admonition. The Commission said that without the injunction Telegram would continue to violate the rules forcing the regulator to seek another restraining order. The Commission also said defendants can “not offer, sell, deliver, or distribute” Gram tokens until the conclusion of the court hearing.

Later in October, TON investors received a letter proposing to move the launch deadline to April 30th, 2020. The investors agreed and the deadline shifted.

On February 20th, 2020, after the hearing, the restraining order obtained earlier by the SEC has been extended until there is a further judgment by the court, which was expected to come before April 30th. On March 24th, the judge ordered against the April launch making the fate of the project and the investors’ money yet more uncertain. Telegram appealed the court ruling on March 25th.

Without a chance to launch TON by the April 30th deadline, the developers confirmed that there will be no token issuance and offered investors two options: take 72% of the money or wait until April 30th, 2021, and get 110% in Gram or another cryptocurrency.

On May 4th, TON investors in the U.S. were informed that they can only take the 72% refund and won’t be allowed to get tokens in 2021. Non-U.S. investors then received a letter saying that there will be no payment in Grams or any other cryptocurrency whatsoever.

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