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Telegram Stars: Can New In-App Currency Distract From Massive Data Breach?

Last Updated 6 days ago
James Morales
Last Updated 6 days ago

Key Takeaways

  • Telegram Stars is a new digital currency for in-app Telegram payments.
  • Telegram was recently implicated in the distribution of millions of hacked account credentials.
  • The data breach highlights ongoing concerns over Telegram’s privacy and security.

Telegram has launched a new in-app currency, Telegram Stars, to facilitate payments for payments for digital goods and services.

The new payment system was announced  by CEO Pavel Durov on Thursday, June 6. But following the news that millions of account credentials were compromised in a massive data breach, the latest announcement has the feel of a distraction tactic.

Telegram Data Leak Sparks Security Concerns

On May 28, an anonymous security researcher disclosed a trove of 361 million email addresses collated from malicious Telegram channels.

The data was shared with Have I Been Pwned (HIBP), an online service that lets people check whether their account information has been compromised. It includes 151 million email addresses that hadn’t been previously seen in HIBP, as well as usernames, passwords, and in many cases, the website they were entered into.

Compromised credentials were sourced from illicit Telegram channels used to share information between hackers and fraudsters.

The incident highlights the tension between Telegram’s dual role as a social media platform and a private communication channel. Channels make it easy to disseminate information among a group of distributed users. But they are also easier to hide from public view than Facebook groups or subreddits.

The Social Media Privacy Paradox

Ironically, the privacy-preserving features that make Telegram a popular platform for exchanging hacked credentials can also help protect users of the messaging app. Although that isn’t guaranteed. 

In 2016, Telegram itself was hacked  by an Iranian group known as Rocket Kitten, who exploited the app’s built-in contact export feature to expose the personal details of 15 million users. 

Critics of the platform also point out that Telegram doesn’t implement end-to-end encryption by default. Commenting on the ongoing Signal versus Telegram debate, Signal President Meredith Whittaker recently called  Telegram “the least secure of messaging and social media services out there.”

Meanwhile, Jarrad Hope, who co-founded the rival platform Status , told CCN that both Telegram and Signal suffer from the same weakness: centralized servers.

“The leak of 361 million Telegram credentials is yet another reminder that even the tools upheld as reliable privacy solutions for those in danger of surveillance and oppression can’t be trusted so long as they’re centrally controlled,” he observed.

On the other hand, he suggested that Signal’s roots in the US government could also be a red flag:

“We must reject promises of privacy from authorities and minimize the need for trust through decentralization and open source code. Only then can we communicate freely without fear of eavesdroppers backdooring into our conversations and putting us in danger.”

While critics have questioned Telegram’s viability as a private messenger service, the recent launch of Stars suggests it is leaning more into its alternative role as a social platform. 

Telegram Doubles Down on Payments

With over 800 million active monthly users and an ever-growing ecosystem of mini apps built on top of the platform, Telegram is well-positioned to launch its own payment service.

Of course, Stars isn’t Telegram’s first foray into payments. The now-independent Toncoin was initially developed in-house but was ultimately spun off into a separate entity under pressure from US regulators. 

Although Telegram has officially cut ties with the blockchain, it remains closely integrated with TON (the open network). And when USDT was deployed on TON in April, Pavel Durov appeared on the same stage as Tether CEO Paulo Ardoino to make the announcement.

While regulatory hurdles may have thwarted Telegram’s initial plan to build its own cryptocurrency, Telegram Stars proposes a compromise. 

From one perspective, Stars function as a sovereign in-app currency, not that different from Toncoin. But tokens can only be purchased through Google or Apple’s respective app stores, ensuring they remain compliant with the two gatekeepers’ policies on digital assets. 

Further down the line, developers will even be able to withdraw their Stars in Toncoins via Fragment .

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