Telegram has made headlines over the past few weeks after acquiring $850 million dollars for their ICO from private investors, and now a new round of funding has been initiated. If the second round matches the first, the Telegram ICO would be worth $1.6 billion before it even gets offered to the public.
The cloud-based messaging service Telegram is working on an ICO, Initial Coin Offering, and so far the project is set to break all the previous records. However, not everyone is sure of the project and there is an underlying risk that the Telegram ICO is pure hype.
Telegram has existed in the epicenter of the crypto boom and most cryptocurrencies have their own channels, while thousands of users use the platform to share investment advice and discuss digital currencies. And this is what’s worrying some experts.
Due to Telegram’s role as an important part of the cryptocurrency movement, they have been able to create a hype that no one else could have done. Consequently, even though Telegram has created a whitepaper for the ICO that has more depth than many other similar projects, people are getting concerned that the ICO is a cover for the founders to get funding.
Telegram Makes Zero Revenue
Telegram’s founders, brothers Pavel and Nikolai Durov, have made it clear that Telegram was created as a completely free messaging tool without any commercial purposes, meaning it’s a part of Telegram’s business model to not make any money. However, as the messaging app grows in popularity, so do the expenses, and since the Durov brothers have promised to accept no outside funding they need to find a way around that. Hence, an ICO would be the perfect solution.
As the second round of private funding is being determined, it is looking like Telegram’s ICO might be worth $1.6 billion dollars before it goes public. That could mean that by the time the ICO is complete and the new token is released, Telegram will have received over $2 billion in funding. Not bad for a company that “makes no revenue.”
What is the Telegram Cryptocurrency?
Telegram Open Network is the name of the blockchain that’s connected to the token that is currently being sold in the ICO. The blockchain is said to be a completely new Ethereum-like blockchain that can be used for cryptocurrencies, app development, and much more. Considering the fact that the founders already have proven that they can develop world-leading technology, the TON could be a huge game changer.
Although, most experts agree that the Telegram whitepaper is well written but that it lacks technical details and is somewhat “overly ambitious.” Christian Catalini, a professor that studies ICOs at MIT, told Verge that, “In the case of the Telegram one there is a lot that is being promised and not a lot of clarity on how that would be delivered.”
The Future of TON
Whether or not the Telegram Open Network is legitimate or not is yet to be seen but we are following the development with excitement. Telegram has created the most anticipated ICO ever, and if it turns out that what the founders claim is actually true, the Telegram cryptocurrency could be revolutionary.
The public part of the ICO is set to start in March and no matter what happens next, the Telegram ICO is already dwarfing all other ICOs with billions of dollars.