The arrest of Telegram CEO Pavel Durov on 24 August 2024 has led to a significant drop in the value of Toncoin ($TON), which fell by 18.7% as of 8:45 a.m. UTC on 25 August 2024. This sudden decline reflects growing concerns in the cryptocurrency market over the potential impact of Durov’s legal troubles on The Open Network (TON), a decentralized blockchain platform closely associated with Telegram.
The Open Network, originally developed by Telegram, is a decentralized blockchain platform designed to provide a scalable and user-friendly ecosystem for decentralized applications (dApps). The platform aims to enhance blockchain technology’s efficiency and accessibility, striving to create an interconnected web of decentralized networks.
Toncoin is the native cryptocurrency of The Open Network, playing a crucial role within the ecosystem. It is used for transactions, payments, executing smart contracts, and participating in network governance. The TON blockchain, known for its unique multi-blockchain architecture, is capable of processing millions of transactions per second, ensuring scalability and avoiding network congestion. This architecture allows The Open Network to support a wide range of applications, making it a versatile platform for developers and businesses.
Despite its promising technology, The Open Network has faced challenges, particularly following Telegram’s decision to step back from the project due to regulatory pressures. The project was rebranded, with the cryptocurrency originally known as Gram being renamed Toncoin. The TON Foundation, a community-driven organization, now oversees the development and management of the network. However, Toncoin remains integrated with Telegram, allowing users to conduct commission-free crypto transfers and interact with Telegram Mini apps through the TON Wallet.
Durov’s arrest at Bourget airport near Paris has sparked a wave of concern. According to a report by Reuters, the French authorities detained Durov as part of an investigation into the lack of moderation on Telegram, which they believe has allowed criminal activities to go unchecked on the platform. Durov, a Russian-born billionaire (who also holds citizenships in France and the UAE), founded Telegram with his brother in 2013 and has been a vocal advocate for privacy and freedom of speech, often resisting governmental demands to censor content.
Telegram has become particularly influential in regions like Russia and Ukraine, where it serves as a key platform for unfiltered content. Since the start of the Russia-Ukraine conflict in February 2022, Telegram has played a central role in disseminating information from both sides. However, this role has also brought increased scrutiny from various governments, including those in Europe, who are concerned about security and misinformation.
The reaction to Durov’s arrest has been swift. Russian officials have criticized France’s actions, drawing parallels to the criticisms Russia faced when it attempted to ban Telegram in 2018. Elon Musk, the owner of X (formerly Twitter), added to the controversy by tweeting about the arrest, suggesting that Europe is moving towards authoritarianism.
Update: At 11:00 UTC on August 25, the Telegram messaging platform issued its first official statement regarding the detention of its CEO. The statement was posted via Telegram’s official Telegram News channel.
However, details about the situation remain unclear. It is still uncertain what charges, if any, Durov faces and whether he has officially been placed under arrest. While some reports suggest that the investigation may be related to the platform’s moderation practices, there has been no official confirmation from the French government or additional clarification from Telegram. However, apparently, the Paris prosecutor’s office has informed NPR that a statement on the situation will be released on Monday.
Featured Image via Pixabay
