The Russian government’s crackdown on Telegram may actually be caused by fears of the instant messaging service’s upcoming cryptocurrency project TON, with the official rationale of failure to comply with local data-protection laws perhaps a pretext.
War on Telegram a Proxy War on TON?
Since earlier this week, Russia has been trying to block local users’ access to Telegram, following the messaging service’s refusal to allow Russia’s secret service to decipher messages. The Russian government expressed its concerns over the threat of terrorism and the security of personal data.
However, recently revealed information paints a different picture.
On April 20th, major Russian business daily RBC published an internal memo from an officer of the Federal Security Service (FSB), in which he allegedly told his colleagues that the whole story is “not about the [encryption] keys and terrorism” but about fears that Telegram’s highly anticipated cryptocurrency, TON, will create an “absolutely uncontrollable” financial system in Russia.
The author of the memo, a certain Roman Antipkin, compares – probably, unjustly – Telegram’s Russian founder Pavel Durov with the late criminal Sergei Mavrodi, known for his financial pyramid scheme MMM in the 1990s.
In the subsequent paragraphs, however, Antipkin gives Durov credit, saying that, unlike the “marginal” phenomenon of bitcoin, Telegram’s cryptocurrency, “will be simple, safe and uncontrolled,” which would eventually “compromise the national security of Russia.”
He also described fears that Telegram’s cryptocurrency could be used for purchasing drugs and for various other illegal activities. When approached by RBC, Antipkin declined to comment. The FSB and Telegram similarly refrained from commenting. But the ideas expressed in the memo would hardly strike anyone in Russia as particularly surprising.
Big Brother Law, Russian Style
The government adopted the data protection law, sometimes referred to by its critics as the “Big Brother law,” back in 2016. It stipulates that all mobile phone operators, instant messaging services, and other transmitters of information must add additional coding to that information which would allow the FSB to decipher any communications it sought to.
The law also stipulates that all personal data of Russian citizens should be stored on servers located within Russia, posing risks to multinationals like Apple and Google. Both those companies eventually agreed to cooperate with the Russian government, while Facebook reportedly remains in negotiations. The business and employment-oriented LinkedIn declined to comply with the law and was banned in late 2016.
Clearly, one of the law’s main intentions was to tighten control over individuals’ personal correspondence. At the time of its adoption, cryptocurrencies may have appeared somewhat marginal to Russian officials and legislators, but that is clearly no longer the case.
Control the Key for the Kremlin
Although Russian officials have been speaking about the need to develop the digital economy and, as part of those efforts, blockchain and cryptocurrencies, the prospect of having a strong alternative financial system that they cannot control terrifies them. And Durov’s successes in creating VKontakte, the Russian equivalent of Facebook, and, later, Telegram, come as a sign that the TON cryptocurrency project, for which Telegram has already raised over $2 billion USD in an ICO, could be equally successful.
But is the Russian government in a position to do anything about it? Even its attempts to block Telegram have been met with minimal success. Millions of IP addresses have been blocked, but Russians still use the messaging service. How, then, does the government expect to control Telegram’s cryptocurrency?
Have your say. Is the Russian government more afraid of an uncontrolled cryptocurrency or unmonitored communications?
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