Telegram, the widely used messaging platform with over 1 billion monthly active users, is reportedly preparing to raise $1.5 billion through a five-year bond offering with a 9% yield. This substantial bond deal has attracted interest from major institutional investors, including BlackRock, Mubadala Investment Company, and Citadel, signaling a significant convergence between traditional finance and the crypto ecosystem.
The proceeds from the bond sale will primarily be used to repurchase debt from Telegram's previous bond issuance in 2021, due in March next year. Additionally, the bonds are convertible into equity at a discount if Telegram decides to go public in the future.
Telegram originally developed The Open Network (TON), a layer 1 blockchain, before spinning it off into an independent operation. The platform's ongoing focus on scaling and enhancing TON infrastructure is likely a driving force behind the need for significant capital. Reports also indicate plans by tokenization firm Libre to tokenize $500 million worth of Telegram’s debt on TON as the Telegram Bond Fund (TBF).
Financially, Telegram has shown strong performance improvements, turning a $173 million loss in 2023 into a $540 million profit on $1.4 billion in revenue in 2024, with projections of over $700 million profit in 2025. This growth is driven by expansions in its advertising business and the introduction of new features such as in-app digital gifts and a developer platform for apps and bots.
The involvement of prestigious institutional investors not only injects substantial capital but also lends legitimacy to Telegram and its blockchain ecosystem, supporting sustainable revenue models over speculative token-only fundraising methods. This bond deal may also signal a new trend for crypto fundraising through debt financing, potentially attracting more traditional investors who may prefer fixed returns and less volatile exposure compared to direct crypto asset investments.