Telegram Raises $1.7 Billion So Far With ICO

Telegram, the Dubai-based messaging app company, has added $850 million to the amount it has raised via an initial coin offering, bringing the total from the ICO to a record-setting $1.7 billion.

According to a report in Cheddar, it is shaping up to be the largest ICO ever. Citing Securities and Exchange Commission documents, Cheddar reported it raised the $850 million in February, in what was its second round of fundraising. Telegram is selling its Gram virtual coins with proceeds going to create a decentralized network for the app, reported Cheddar. The second round of fundraising required investors to invest a minimum of $1 million, noted the report. Telegram is gearing up for the third round of fundraising again in the $850 million range, reported Cheddar. That would bring the total to $2.5 billion.

In January the Financial Times reported three big Silicon Valley venture capital firms wanted to invest in Telegram’s initial coin offering (ICO): Kleiner Perkins Caufield & Byers, Benchmark and Sequoia Capital have each told the messaging startup that they want to invest $20 million, according to three individuals familiar with the deal. Sequoia and Kleiner declined to comment, and Benchmark did not respond to requests for comment from the Financial Times.

Some investors, however, aren’t enthusiastic about the offering. A San Francisco cryptocurrency investor told the paper that the company’s plans were “hyperbolic claims” and a “huge red flag.” Through the ICO, Telegram hopes to raise $600 million by the end of February in a round only open to large investors ahead of a $600 million public round in March. According to TechCrunch, Telegram was founded by Pavel Durov, a Russian entrepreneur who was the founder of VKontakte, Russia’s Facebook. He was ousted from that company in 2014 and has since worked on developing Telegram, which has 100 million monthly users and 350,000 new users joining per day.