Telegram’s Compliance Update: Disclosing IPs of Illegal Users on Legal Request

On September 23, Telegram founder Pavel Durov posted on his personal channel that users who abuse public channels for illegal activities, violating the platform’s terms of service, may have their IP addresses and phone numbers disclosed to authorities upon legitimate requests. Previously, Pavel Durov was arrested by French police for allegedly allowing criminal activities on Telegram. After posting bail, he was released but remains under judicial supervision and must report to the police every two weeks.

Notably, Telegram has long been known for its strong privacy protections and security features. However, facing growing compliance demands from global regulators, Telegram has had to make adjustments, with Durov now offering to disclose user IPs as a concession to compliance following his legal issues.

Telegram’s Integration with Web3

With its massive user base and open API, Telegram has become an ideal platform for Web3 applications. Telegram officially supports the $TON token for all transactions within channels, helping the platform become a bridge for financial flows between Web2 and Web3. Additionally, The Open Network (TON) has been integrated into Telegram’s user interface, with an ecosystem encompassing decentralized finance, domain names, gaming, and more.

This combination brings unprecedented convenience and innovative experiences to users while driving substantial growth in both user bases. For instance, the Telegram-based click game Notcoin attracted 35 million users to the crypto market by rewarding users with token airdrops. Many blockchain projects also choose Telegram for community engagement, and its convenient group and channel features enable easy interaction between crypto projects and users, sharing updates and news. Numerous bots on Telegram provide crypto users with features like arbitrage alerts, data monitoring, and price checks, making Telegram accounts a standard for industry insiders.

However, this combination of Telegram and Web3 also brings risks. Criminals use Telegram chats to conduct illegal trades, money laundering, and even plan terrorist activities, turning Telegram into a communication tool for black and gray markets in some cases.

Telegram and the Black Market

Telegram supports secret chats, customizable privacy settings, and self-destructing messages, all aimed at protecting user privacy. The end-to-end encrypted secret chat feature ensures that only the participants can view the conversation, making it difficult for authorities to track or monitor illegal activities. Privacy settings allow users to hide their phone numbers and last online times, enhancing anonymity, while message deletion and self-destruct features make it hard to permanently retain evidence of crimes.

Although intended to protect users from unauthorized surveillance and data breaches, these features are sometimes exploited by criminals. One case involved a victim attempting to report to the police, but the case was not filed due to the lack of Telegram chat evidence.

Furthermore, Telegram’s powerful search feature allows users to find public channels and bots, which has been abused by criminals to promote or sell illegal goods. As reported by Bitrace, a Drainer organization sold its services via Telegram groups, taking a 30% cut of stolen funds. This organization, which was founded in April, had gained 596 subscribers by May and claimed to have profited over $200,000 in the TON ecosystem. (A Drainer is a type of malware designed to illegally drain cryptocurrency wallets. This malware is rented out by its developers, meaning anyone can pay to use this malicious tool.)

Despite pressure from events like ISIS using Telegram for planning terrorist attacks, and the South Korean “N Room” incident where operators created live streaming rooms and profited from cryptocurrency transactions, Durov maintained, “We shouldn’t feel guilty about this. I still believe that what we are doing is right, which is protecting users’ privacy.” His firm stance to some extent has emboldened illicit activities on the platform.

“Is the risk of terrorist actions greater than the right to 100% privacy? This is a large societal debate about values.” Now, with the decision to provide more user data to governments, Durov seems to have found the answer.

The Balance Between Privacy and Compliance

Recently, Pavel Durov announced an update to Telegram’s privacy policy: for those who break the rules, IP addresses and phone numbers will be disclosed to relevant authorities upon valid legal requests. This marks an important step forward in compliance for Telegram.

In recent weeks, Telegram has also formed a dedicated team using AI technology to block access to potentially illegal content in its search feature. By further updating its terms of service and privacy policies, Telegram has demonstrated its commitment to combating illegal content and protecting its nearly one billion users worldwide.

As a global communication platform, Telegram must strike a balance between protecting user privacy and complying with regulatory requirements. This balance should be adjusted dynamically based on local laws, specific incidents, and application scenarios. For example, when receiving valid legal requests from law enforcement, Telegram will disclose the personal information of relevant criminals, who will no longer be protected by the platform. By sacrificing the privacy of a few wrongdoers, Telegram can prevent further abuse without compromising the privacy of the general user base.

The Importance of Compliance

By strengthening compliance measures, Telegram provides a safer and more trustworthy platform for users, laying a foundation for its long-term development in global markets. However, the “N Room” incident shows that criminals seeking to profit from social software face challenges in doing so. The exchange and circulation of cryptocurrency are key factors, which is why anonymous cryptocurrencies are widely used in illicit activities.

As cryptocurrencies, particularly stablecoins like USDT, become more widely adopted, companies dealing with them should implement a detailed KYT (Know Your Transaction) mechanism to comply with regulations and manage risks. For any risk management professionals with KYT needs, feel free to contact us through various channels to request a demo.

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