Telegram founders Nikolai and Pavel Durov reported that they have successfully raised $850 mln. Their second round of initial coin offering (ICO) has yielded a positive result as they announced in a notice today with US Securities and Exchange Commission.
The ICO sought investment to promote the development of Telegram, the messenger app as well as its dedicated Blockchain platform called the Telegraph Open Network. Even though the document didn’t disclose the investor’s identities, 94 different entities were part of the ICO that started earlier this month. In the column where the applicant states the type of securities on offer, the document reveals that it is purchase agreements for cryptocurrency.
The Federal Exemption
The coin offering was offered under the Federal Exemption 506(c). That section states that a company may broadly solicit and advertise their offering and still be considered compliant with the requirements of the exemption. There will be no sanctions as long as all conditions are met. All investors in the coin offering must also be accredited. The issuer must be diligent and take steps to also verify the accreditation.
The ICO’s first round started in January and ended on 13th February. This round managed to draw in $850 mln from about 81 investors.
A news agency called Vedomosti reported that an investor in the initial ICO round was Roman Abramovich, a Russian billionaire. Close acquaintances with the billionaire told the agency that Abramovich had invested about $300 mln. The spokesman of Abramovich, Jon Mann refused to comment on the matter but denied that he made the investment.
Two other investors have spoken publicly about their support for the ICO. They are Qiwi’s founder, Sergei Solonin and David Yakobashvii, the founder of Wimm-Bill-Dann foods.
The current regulation of initial coin offerings by the SEC depends on legislation from the many decades ago.