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It seems that the well-known cloud-based messaging service Telegram won’t be holding its public token sale.

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Telegram, a popular instant messaging service based in London, has decided to cancel the planned public part of its initial coin offering (ICO) after raising more funds during the private sale than it anticipated.

An insider told The Wall Street Journal that the annulment of the public sale occurred after Telegram Group Inc. made $1.7 billion by selling newly issued cryptocurrency to only a few exclusive private investors.

According to the source, less than 200 investors were able to participate in this token sale. Only accredited investors that have a net worth surpassing $1 million were permitted to participate in this ICO, which raked in $850 million twice in a sequence of private deals — the first having 81 investors, and then second 94 investors.

The venture funds came after Telegram’s founders assured an innovative new development, depicted as “a Visa/Mastercard alternative for a new decentralized economy.” The plan is basically the deployment of a digital payment platform which will succeed in being adopted by the mainstream in no time.

The raised funds will reportedly be used for the Telegram Open Network project, which has the intent of expanding on its existing messaging service — which itself has over 200 million users from all around the world.

Telegram Group Inc. has not publicly commented on the cancellation of its public sale, but some have conjectured that the company simply made enough funds before the coin offering. One person acquainted with the situation, though, said to The Wall Street Journal that Telegram is feeling uncertain regarding the new regulations— particularly when it comes to the U.S. Securities and Exchange Commission’s new rules concerning ICOs. It’s also very likely that the cancellation was determined by both reasons.

Positive Prospects

Telegram’s ICO hasn’t only attracted attention for how many earnings it managed to gather.

Some blockchain investors have not manifested too much enthusiasm regarding what the company is selling. Instead, they worry that the company might have attempted to do more than it was capable.

“My primary concern with it is that in the first offering institutions are seriously looking at, they’re promising something that will somehow be radically better than everything else out there, with no real explanation of how that will happen or outside scrutiny of those claims,” said Charles Noyes of blockchain-focused investment company Pantera Capital.

Manager of 1confirmation, Nick Tomaino, has also gone on record to declare that he doesn’t believe that Telegram is capable of accomplishing their proposed objective, stating:

“It’s a big-name ICO, attracting big-name investors, but I ultimately believe the effort requires deep technical expertise and historical context on crypto-economics, consensus mechanisms, and scalability, which they don’t have.”

If Telegram will manage to keep its promise remains to be seen, but at least if their plans fail to be achieved, they will have the funds to pick themselves up.

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