One of the third-party services popularly integrated into the messaging platform Telegram is to face a shutdown in the United Kingdom temporarily because the company is undergoing restructuring. The wallet service, which enables users to store and manage their cryptocurrency, has announced in a statement released on Sept 25, that its operations in the UK are to be suspended due to regulatory requirements.
According to the company, this is part of its efforts to apply the regulations of the UK’s Financial Conduct Authority, or FCA. Now, as part of a restructuring process, Wallet within Telegram should function under the Open Platform, meaning that the entity needs to be registered as a provider of crypto assets.
The users of the Wallet application in Telegram within the United Kingdom will not be able to use wallet features from the application. The company, however, has already assured its users that they will still be able to withdraw the funds they have to an external wallet. This withdrawal will not be accompanied by any fee charges for the duration of this transition period. According to the company that issued Wallet in Telegram, it would post updates regarding account status as well as further registration processes for users’ reference from time to time.
Wallet in telegram: The wallet has nothing to do with the telegram itself
That is to clarify that Wallet in Telegram is neither a product of Telegram nor owned/controlled by Telegram itself. While both services are closely linked in the minds of users, owing to the integration, the wallet service is managed by an entirely separate entity. The company behind Wallet at Telegram has publicly stated that this FCA registration effort is a standalone decision and not related to other recent changes announced by Telegram itself.
Telegram had its battle lines during the last couple of months, including heightened watchful eyes from regulatory and law enforcement establishments. The arrest of the founder of Telegram, Pavel Durov, in September 2024 represents a series of policy adjustments within the platform, which this time took a controversial turn in its approach to user data and privacy.
The restrictions now extend to the United States.
Similar constraints have been enforced on users from the United States, where, more importantly, Telegram Wallet had been blocked as well, due to financial regulations. Users in the US had therefore not been able to access the wallet service offered in the application. The regulatory complexity in the world of cryptocurrencies seems to be pretty apparent here. US and UK authorities have clamped down the rules surrounding cryptocurrency transactions and operations by requiring companies to register and obtain licenses to keep anti-money laundering and know-your-customer regulations in line.
Policy changes at Telegram raise concerns:
The suspension of Wallet in Telegram’s UK operations occurs in the context of broader changes occurring within Telegram itself. according to The Guardian Following his arrest, the service announced it had decided to shift its policies on privacy, announcing that it would cooperate with law enforcement agencies when required. Telegram now says it will share user data, which includes telephone numbers and IP addresses, once a “valid legal request” is made by authorities.
For many, this has raised a storm among both privacy advocates and anti-censorship groups because they foresee the possible abuse of user data by state actors. It was for this reason that Telegram, in many people’s perception, had been a bastion of not only anonymity but also free speech, particularly in zones of censorship and government surveillance. This new stance of the platform thus rang alarm bells to those who use it to communicate and organize in repressive environments.
Pavel Durov responded with a message published to the Telegram community, explaining that his company needed to take this step in the interest of being protected from criminals who abuse the services. According to him, the new move would deter those who use Telegram for illicit purposes:
“These measures should discourage criminals. Telegram Search is meant for finding friends and discovering news, not for promoting illegal goods. We won’t let bad actors jeopardize the integrity of our platform for almost a billion users.”
Feature feature updates
Aside from these policy updates, Telegram also announced that it will be changing some of its features from the app. Last September 2024, the company announced that it would disable the personal geolocation feature that allows a user to share his exact location with others. The said feature, however, will be replaced by a new feature called “Businesses Nearby” which was allegedly created to support local commerce and interactions instead of personal tracking.
Another important loss is the services provided to Telegram’s “Telegraph” blogging tool, where people could write and publish articles and posts through the service. According to Durov, although most used the tool responsibly, a few minorities misused it for nefarious activities, in particular, spreading illegal content.
While Durov admitted that only a tiny number-“0.001% of the users”-had used Telegram in such a way, he made it clear that their activity was a super-proportional risk for the rest of the TG community. Dropping the tool will make it less possible for misuse, with a generally safe online environment in TELEGRAM.
What is in the future for the wallet in telegram
The same is expected to prevail until the wallet service can obtain the needed regulatory clearances from the FCA. In the meantime, the wallet service will keep its users updated on its operational status and ensure that those whose services it has affected are not disrupted in any way.
It has been a setback for the Wallet in Telegram, but at the same time, it represents the broader trend in the cryptocurrency industry. Everywhere, new regulations are being implemented, and the crypto companies are compelled to be very compliant with new rules and frameworks to survive commercially. The way the services of Wallet in Telegram and such providers will evolve around these challenges will set the future of cryptocurrency adoption in regulated markets like the UK and the US.
The regulatory environment is bound to change as it continues to evolve, and both wallet providers and users will need to stay abreast and prepare for any subsequent changes that might influence the accessibility and functionality of crypto services.
Discover more from MegaloPreneur Magazine
Subscribe to get the latest posts sent to your email.