In brief: Telegram is the latest company that wants to launch a digital currency with high ambitions and a tight deadline. To succeed, it must comply with regulators by the end of October, which sounds unlikely but only time will tell. The company doesn't have the best relationship with governments, but it stands to lose a hefty investment, so it's trying its best to deliver on its promise.
While many are probably familiar with Facebook's efforts to take the global payments market by storm with its Libra cryptocurrency, you may have not heard about a similar project that comes from another social network, Telegram. There have been several rumors of an "initial coin offering" (ICO), but the company had reportedly scrapped the plans after seeing the increasingly tight regulations proposed the Securities and Exchange Commission.
Now, it turns out that the much-hyped project might see the light of day. According to a report by The New York Times, Telegram is planning to launch a digital currency called Gram within the next two months. The company has told investors that it's going to roll out the Gram wallets to two thirds of its estimated 300 million global users.
Just like Libra, Gram is yet another digital currency that promises to make payments easy, fast, and secure. However, due to the way Telegram works, the very same encryption that makes its messaging app secure is also what brought it under the lens of regulators. The company's digital currency will probably emulate Bitcoin in many ways, which would make it an attractive option for people interested in avoiding laws and regulations. This wouldn't bode well with authorities, who are increasingly interested in such developments and their many implications.
Telegram is apparently pushing its token out to hold onto an estimated $1.7 million raised from over 200 investors. The idea here is that the company has a deadline – if it doesn't manage to launch Gram by October 31 it risks losing all that money.
In the grand scheme of things, several companies are trying to push their own digital currencies. Binance is a notable example with its Venus cryptocurrency, but that is in the early stages of development. Still, Telegram's token isn't backed by real currency and its value would instead fluctuate as a result of how many people are willing to invest in it.
The company says a test version of the Gram network will go live within the next few weeks, and third party wallet providers like Button Wallet are jumping in to help with adoption by offering Gram tokens to those who activate its wallet. The social platform has bigger plans for the Telegram Open Network – it wants to slowly evolve it into a decentralized infrastructure for all kinds of digital applications, similar to Ethereum.