Durov's defeat against the SEC is a heavy boulder but it is not the time of defeat for the youth of the new world order
But now the dream is gone
“Today is a sad day for us here at Telegram. We announce the interruption of our blockchain project”
The message of surrender arrives on the Telegram chats at 18.51 on 12 May. The sender is Pavel Durov, the 135-year-old Russian billionaire creator and owner of the rival instant messaging app of Whatsapp. For Durov it is the darkest hour, the moment in which a dream worth at least 1.7 billion dollars is broken, as many as the money collected so far by hundreds of investors to develop a new cryptocurrency, the Grams, which in the young billionaire's plans were destined to become Telegram's virtual currency. In practice, what Libra will be (or should be) for Facebook, the company of its antagonist Mark Zuckerberg: a business of incalculable value.
What Vladimir Putin could not do, was obtained by the Sec, the American Securities and exchange commission
On March 24, an American court ruled that Grams is not a cryptocurrency like Bitcoin but is a financial product that must be authorized by the SEC and, given that this has not happened and that the currency could be purchased by American citizens, it should therefore be stopped, all over the world.
Durov thought for a long time but after 49 days he gave in. The Telegram Open Network project is officially dead. For Durov, it is a hard break to digest. With 3.4 billion dollars of cash flow, the Sec managed to block the Russian tycoon by not giving the authorization to the virtual currency assets, the inventor of Telegram is for Forbes under 65 richest man in the world.
Who is Pavel Durov?
But Durov is not only this. It is the embodiment of a new world elite that moves without borders, repudiates the power of states and disrespect the authority that governments exercise over entrepreneurial initiatives. Durov is the anti-state, the enfant prodige of anarcho-capitalism. After the US court ruling, Durov has hardly criticized the United States by raising a global legal issue.
"The Court's decision - he accused - implies that other countries do not have the sovereignty to decide what is good and what is bad for their citizens”
Born in Leningrad (today Saint Petersburg), childhood in Italy, in Turin, then again in Russia where in 2006 - after finishing university - he created VKontakte, the Russian social network competing with Facebook, Durov soon clashes with the secret services of Putin, who would like to enter the social network chats to monitor Ukrainian users during the Crimean crisis.
He was forced to give up his creature in 2014 at the height of success but in the meantime he created Telegram, the app that today reached 400 million monthly users and which was to spread the new Grams cryptocurrency. After the 2014 he left Russia and now lives in Dubai but in 2013 he purchased the passport of Saint Kitts and Nevis - archipelago in the Antilles, where he never set foot - to move undisturbed without using the Russian pass.
Dubai, Moscow, Antilles, everywhere and nowhere, according to the principle of risk diversification. Difficult to block someone you don't know where he is. A rule scrupulously observed also to structure the group of companies that control Telegram, a nebula of entities on which it is difficult to light a beacon because they are dispersed in some of the world's most impenetrable tax and corporate havens.
To find the secrets in the British Virgin Islands To clarify Telegram's corporate structure, it is necessary to consult the documents filed in the Court of the Southern District of New York, where the SEC filed the case to obtain a stop to the Telegram blockchain.
And rummaging in his archives until he also finds the yellowed documents of a 2014 lawsuit in which Durov had sued his former partners in VKontakte. This is the only way to reconstruct - at least partially - how Pavel Durov controls his wealth valued by Forbes at $ 3.4 billion.
Even if for some years Durov has lived in Dubai, in the United Arab Emirates, where the operational heart of Telegram is based, to climb to the top of the pyramid of the empire of the Russian billionaire you have to fly to Road Town, on the island of Tortola, the most important of the British Virgin Islands (Bvi).
This is where Telegram Group Inc is located, which according to the SEC is the controlling holding of the web company. In Road Town, Durov owns three other companies: Telegram Messenger Inc, Dogged Labs Ltd and Ton Issuer, the entity created specifically to manage the Telegram Open Network operation that was supposed to generate the new cryptocurrency.
From Belize to Panama Telegraph Inc is 2,500 kilometers west of Belize (another tax haven) and Telegram Corp is registered 1300 kilometers south of Panama.
The companies buildings are just mailboxes, without employees and domiciled in buildings where thousands - and tens of thousands - of other companies are based.
They are the perfect places if you want to keep an aura of mystery. Taxes are not paid, there is no obligation to file financial statements and to provide information on shareholders and actual beneficiaries Last stop: four other companies in the Telegram galaxy are domiciled in Delaware, where the same principle applies to the Bvi, of Panama and Belize. The entities are called Telegraph Llc, Durov Llc, Telegram Llc and Pictograph Llc. Together with Digital Fortress Llc (in New York State) the latter two were at the center of the controversy that pitted Durov against his former partners in VKontakte in 2014. It is impossible to have access to the financial statements and understand who the actual shareholders are. From Delaware to Dubai there are more than 1 thousand kilometers away. Two companies are registered in the Emirate: Telegram Software House Llc, managed by Alexandr Stepanov, right arm of Pavel Durov since the time of VKontakte, and Telegram FzLLc This is, formally, the operating company that manages Telegram.
A new young world elite
It is here in St. Petersburg that in 2006 he created the Russian Facebook, VKontakte (Vk.com), which in a few years has an extraordinary success and makes it rich. Libertarian entrepreneur But when Vk.com is now the most popular social network in Russia, Putin's men realize that he can no longer remain outside the regime's control. They repeatedly ask Durov to allow secret services to access servers. Durov refuses and begins to build the image of a libertarian entrepreneur and allergic to all forms of power. When he loses control of Vkontakte and eventually surrenders his $ 300-million share, he makes Telegram a bulwark of privacy by refusing to open its servers to the governments of Russia and Iran. Good luck Durov