Correct understanding of the Telegram refund plan indicates that U.S. investors will be forced to "redeem their initial investment at a discount."

The privacy messaging app Telegram indicated in a recent letter sent to U.S. investors that, regarding the token refund plan, U.S. investors can only choose to redeem the initial investment funds immediately at a 72% discount, and are not allowed to opt for the 110% delayed alternative.

Correct UnderstandingAlternative Solution

According to the report on April 30th, due to another delay in the release of its blockchain project - TON, Telegram triggered the refund clause in the token sale agreement, allowing each investor to redeem up to 72% of the initial investment amount from Telegram. In response, Telegram proposed an alternative solution to token investors in the letter sent to them.

Apart from allowing investors to immediately redeem 72% of the invested funds, those who choose not to redeem and are willing to continue waiting can opt to keep the investment amount reserved for Telegram in the form of a loan until April 30, 2021, and choose to receive 110% of the initial investment in the form of fiat currency, TON blockchain's native token GRAM, or other cryptocurrencies within the next 12 months.

There is a misconception about the alternative solution. In reality, the alternative solution is of a "loan" nature, meaning that regardless of whether Telegram defaults by April 30, 2021, Telegram must pay investors 110% of the initial investment amount. Additionally, if Telegram fails to obtain permission to issue cryptocurrencies before that date, the company will repay investors' debts from the proceeds of selling stocks.

Latest Refund Rule Changes

However, the Telegram team pointed out in the latest customer letter that due to regulatory concerns, Telegram will cancel the option of GRAM and other cryptocurrencies, meaning that refunds can only be made in fiat currency and not involve any cryptocurrencies. The Telegram team stated in the customer letter:

"Unfortunately, based on further discussions with relevant authorities and our lawyers, due to regulatory concerns about uncertainty, we have made the difficult decision to cancel GRAM or other cryptocurrencies as refund options."

On the other hand, in the latest letter sent to U.S. investors by Telegram, it was further stated that, following negotiations with the relevant authorities, U.S. investors will not be eligible for the 110% alternative solution and can only choose to immediately redeem 72% of the initial investment at a discount.

Struggling

By delaying the refund period in this manner, Telegram is giving its blockchain project - TON a last chance, allowing Telegram to continue to fight for the opportunity to implement the blockchain - TON and token - GRAM over the next year. However, even this last year of maneuvering time has now been stripped away.

Although Telegram stated that the ban on the "110% alternative solution" only applies to U.S. individuals referred to under Reg S of the U.S. Securities Act, we do not know the proportion of U.S. investors in Telegram's token sale. If U.S. investors make up a majority, the implementation of TON will face greater obstacles.

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