You may have seen the word ICO being thrown around very liberally over the past year. Companies you’ve probably never heard of are aggressively promoting their ICOs on Facebook. It stands for Initial Coin Offering. A company that’s doing an ICO offers investors units of a new cryptocurrency or crypto-token in exchange for digital currencies like Bitcoin and Ethereum. Telegram, a well known messaging company, is reportedly going to do an ICO later this year to raise a staggering $1.2 billion.
ICOs have become a very popular instrument to raise funds. Companies offer tokens against cryptocurrencies and investors can sell or trade the token on all cryptocurrency tokens provided that a demand exists.
However, there’s no shortage of ICO scams as well. There are plenty of cases in which the capital raised through ICOs has been essentially stolen as the company behind a touted blockchain project has closed shop and disappeared. Investors are left with worthless tokens as a result of the scams.
Citing a 23 page document obtained by it, Mashable reports that Telegram is preparing for its own Initial Coin Offering to raise a staggering $1.2 billion through a presale and dynamic token crowdsale. At this rate, it would be the largest ICO in history.
There’s likely going to be a lot of hype and interest in this ICO given that it’s Telegram that’s behind it. It’s not just a company that nobody has ever heard of. Telegram is a well established messaging company serving hundreds of millions of users across the globe.
Telegram’s new project is reportedly called Telegram Open Network or TON. It’s going to be a third-generation blockchain leading the way after Bitcoin and Ethereum with superior capabilities. Telegram is said to use its own blockchain platform and native cryptocurrency to support payments on its chat app and elsewhere online.
The company is expected to make an announcement in this regard later this month. The ICO is expected to take place in March.
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