Telegram's Blockchain Developer TOP Raises $28.5M, Valued at $1B

Telegram blockchain startup TOP raises $28.5 million as messaging platform expands crypto footprint

Crypto has a new unicorn. The Open Platform, one of the main app developers on the blockchain chosen by the messaging app Telegram, announced Thursday that it had raised a $28.5 million Series A at a $1 billion valuation. The fintech specialist Ribbit Capital led the round, with participation from the crypto VC Pantera Capital. The raise was for about 5% of equity and did not include allocations of cryptocurrency, The Open Platform founder and CEO Andrew Rogozov told Fortune. The Open Platform, which also refers to itself as TOP, has raised a total of over $70 million across multiple funding rounds, he added. TOP is one of the key companies working on apps for the blockchain called The Open Network, or TON. And that blockchain is closely associated with Telegram, one of the world's most popular messaging apps. It's a complicated mishmash of entities, but the upshot is that TOP is helping spearhead the integration of crypto into an app that boasts more than one billion users, according to Telegram founder Pavel Durov. That reach has VCs salivating. Investors at Ribbit Capital and Pantera pointed to Telegram's large user base in statements included in a press release for TOP's raise. "The opportunity to support groundbreaking tech and financial products that reach one billion people is inspiring," said Ryan Barney, a partner at Pantera. And they're not the only ones who are excited. In March, the TON Foundation, another entity tied to the blockchain, said VCs like Sequoia Capital, Benchmark Ventures, Draper Associates, and, of course, Ribbit had accumulated $400 million of TON's cryptocurrency. Just like the mishmash of entities involved in Telegram's chosen blockchain, the origins of TOP, TON, and Toncoin are far from simple. In 2018, Durov raised $1.7 billion after he and Telegram sold a cryptocurrency to support the development of a blockchain called Telegram Open Network, or TON. In 2019, the Securities and Exchange Commision filed to stop what it alleged was an illegal securities offering, and, in 2020, the regulator and Telegram came to a settlement. The messaging app agreed to return more than $1.2 billion to investors and pay an $18.5 million fine. While Telegram seemed to distance itself from crypto, other developers continued to work on the discarded tech behind the scenes, including Rogozov. And in 2023, Telegram anointed a new version of TON as its exclusive blockchain of choice. That same year, Rogozov incorporated TOP, according to a business registry in Abu Dhabi, where the company is based. TOP is the main developer behind TON's most prominent crypto wallet, aptly called Wallet in Telegram. Outside of the U.S. and Europe, Telegram, the app, has integrated the wallet into its main menu and is available to users in Russia, Asia, and other geographies. Rogozov plans to use the new injection of capital to expand the wallet into the U.S. and Europe. "We need to support everything related to compliance, operations and stuff, right?" he said. "That's very expensive to build." He and his team also plan to use the money to incubate other TON-based projects, including blockchain games and AI applications. In TOP's Series A, Ribbit acquired about 4% of the company, and Pantera netted around 1%, Rogozov said. The company's early backers are Dubai investment firm Vy Capital and Dmitry Eremeev, a Russian investor. Kingsway Capital and Brevan Howard are also backers, according to the Abu Dhabi business registry.

Telegram blockchain developer startup TOP raises $28.5 million at $1 billion valuation

The Open Platform, a developer of tools for encrypted-messaging app Telegram Messenger Inc.'s blockchain ecosystem, announced today it raised $28.5 million in a Series A funding round, bringing its valuation to $1 billion. The funding round was led by Rabbit Capital with participation from Pantera Capital. TON has a rocky history. In 2018, Telegram raised $1.7 billion through selling cryptocurrency to support the development of TON, which attracted the attention of the United States Securities and Exchange Commission. In 2019, the SEC sued Telegram, alleging the raise was an illegal securities offering, and in 2020, Telegram and the SEC reached a settlement resulting in $18.5 million fine and had to return some of the money raised in the token offering. Despite these setbacks, Telegram selected a new version of TON in 2023 as its exclusive blockchain partner and TOP became its main developer. The company is now the developer of the blockchain's main crypto wallet, Wallet in Telegram, which is where users can buy, sell and trade Toncoin. It is integrated directly into the main menu of the Telegram app outside of the United States and Europe, making it available to users in regions such as Russia and Asia. Other products made by TOP include decentralized exchanges where users can buy, sell and trade crypto, non-fungible token marketplaces and blockchain games. "By combining TON blockchain with Telegram's global reach, we're building both the infrastructure and the consumer-facing apps needed to onboard a billion users to crypto," said The Open Platform Chief Executive Andrew Rogozov. Rogozov said the company's long-term strategy would be to support the firm's wallet expansion efforts in the U.S., EU and other regions, with a focus on regulatory licensing, compliance and infrastructure development. The company would also incubate other TON-related projects, including blockchain games and artificial intelligence applications.