Telegram is at it again. While most cryptocurrencies’ prices have taken a nosedive with some even hitting record lows for the year, Telegram remains unfazed and has repeated its exploits from earlier in the year when it broke the ICO record for the most amount of money raised ($850 million). This brings the total amount raised by the messaging app to $1.7 billion, a figure that’s way above their initial target and one that the company may still surpass in the coming days.
THE RECORD BREAKERS
Reports of the expected ICO started spreading as far back as early December of last year among blockchain enthusiasts. The excitement grew rapidly, partly due to Telegram’s popularity in the cryptocurrency community and partly due to the continued silence from the Durov brothers, which only served to heighten the excitement of many. The target for the ICO was rumored to be $600 million, an ambitious figure that would itself make it the biggest ICO yet.
In early February, reports emerged that Telegram had raised $850 million from 81 accredited investors in the closed ICO which took place in late January. Telegram’s native digital asset was called the Gram and went for $0.30 during the offering, but the price is said to have risen to $0.38 due to high oversubscription. The crowdsale set the record for the most funds raised in an ICO, a record that was previously held by Filecoin. Filecoin is a decentralized digital storage and data retrieval project from Protocol Labs.
Despite raising an unprecedented amount of money for a yet-to-be-proven blockchain network, Telegram wasn’t close to being done. The second round of funding took place in late March, and, according to documents filed with the SEC, the company has managed to raise yet another $850 million, bringing the total amount raised so far to $1.7 billion. And this is probably not the last funding round Telegram will hold.
THE TELEGRAM OPEN NETWORK
All that money is expected to be used to develop the Telegram Open Network (TON). TON will be a fast and scalable multi-blockchain network that Telegram hopes will solve some of today’s most pressing blockchain challenges. Current limitations include the speed of transactions, high costs incurred, and scalability. Telegram plans on taking advantage of its existing community of over 200 million users to drive a network that will be able to process millions of transactions per second.
TON also promises an easy-to-use interface that will make it easy and convenient for users to transact in cryptos and use decentralized applications. The network will rely on the Proof-of-Stake consensus algorithm and will offer an infinite sharding paradigm that will allow blockchains to split and merge easily to adapt to changes without slowing down the network. Other services that the network will offer include file storage, decentralized browsing, support for decentralized applications, micropayments channels, and a DNS service.
THE FEARS AND DOUBTS
Even with the excitement surrounding the Telegram ICO, lingering doubts exist. The first issue that many in the cryptocurrency community have raised is Telegram’s hunger for massive funds to develop the platform. Most projects in the past have raised a decent amount of money which has been used to develop multi-billion dollar projects. Ethereum, which is now one of the biggest names in the cryptocurrency universe and is currently worth over $37 billion, only raised $20 million during its fundraising rounds. The vast amount raised will require Telegram to become worth at least $2 billion for it to give investors a return on their investment.
Even more unsettling is Telegram’s withholding of any information related to the Telegram Open Network. The Durov brothers have remained tight-lipped about the project in public. This has fueled speculation that there may be something fishy going on behind the curtain. The silence may be a tactic, though, to build interest in the project, but for now, all we can do is speculate.
It remains to be seen what direction this project will take going forward, but the crypto community is hopeful that their most beloved messaging app will become even better and that its TON platform will be a massive success, which would be a huge mainstream boost for blockchain technology.