Adam Back Critiques Telegram’s Inflationary GRAM Token Amid Durov’s Bitcoin Praise
Bitcoin developer Adam Back on Thursday criticized the inflationary design of the GRAM token, the native asset of the Telegram Open Network (TON), according to a tweet shared by Back. The remarks came days after Pavel Durov, Telegram’s founder, praised Bitcoin on X (formerly Twitter), highlighting its role as a store of value.
Back, a co-founder of the Bitcoin Foundation, argued that GRAM’s inflationary model risks undermining its utility as a stable medium of exchange. “Inflationary tokens erode trust in long-term value preservation,” Back wrote, citing a 2023 analysis by the MIT Digital Currency Initiative.
Durov’s endorsement of Bitcoin followed a series of tweets in which he emphasized the cryptocurrency’s resilience against fiat currency devaluation. “Bitcoin’s scarcity is its strength,” Durov stated, linking to a 2024 report by the International Monetary Fund (IMF) on digital asset adoption.
GRAM Token’s Evolution: From Toncoin to Gram
The GRAM token, initially launched as Toncoin in 2020, was rebranded to Gram in 2023 as part of TON’s restructuring after legal challenges with the U.S. Securities and Exchange Commission (SEC). The rebranding aimed to clarify the token’s role within the TON ecosystem, which now operates independently of Telegram’s parent company.
According to a press release from the TON Foundation, the rebranding “aligns with global regulatory frameworks while maintaining the network’s decentralized infrastructure.” However, critics argue that the token’s inflationary mechanism—designed to fund network development—creates uncertainty for investors.
Market Reaction and Expert Analysis
The GRAM token’s price dropped 8.2% in 24 hours following Back’s critique, according to CoinMarketCap data. Analysts at Bloomberg Intelligence noted that “inflationary designs often face scrutiny in the crypto space, where scarcity is a key differentiator.”
Back’s comments contrast with Durov’s Bitcoin advocacy, highlighting diverging philosophies within the crypto community. While Bitcoin’s fixed supply of 21 million coins is seen as a hedge against inflation, GRAM’s model prioritizes liquidity and network growth, according to TON’s whitepaper.
What’s Next for GRAM and Bitcoin?
The TON Foundation has yet to respond to requests for comment on Back’s critique. However, a statement from the organization emphasized its commitment to “balancing innovation with user trust.”
Analysts predict continued tension between inflationary and deflationary token models as the crypto market matures. “The debate over token design reflects broader questions about the role of digital assets in financial systems,” said Dr. Laura Nguyen, a fintech researcher at Stanford University. “Both approaches have merits, but clarity is essential for adoption.”
Key Takeaways
- Adam Back criticized GRAM’s inflationary model, citing risks to long-term value preservation.
- Pavel Durov praised Bitcoin’s scarcity, aligning with broader sentiment among crypto advocates.
- GRAM, previously Toncoin, was rebranded in 2023 to align with regulatory standards.
- Market reactions highlight ongoing debates over token economics in the crypto space.
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