Telegram plans to issue $1.5 billion in bonds and will integrate xAI, Elon Musk's company, gaining shares and subscription revenue sharing
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Telegram plans to issue $1.5 billion in bonds and will integrate xAI, Elon Musk's company, gaining shares and subscription revenue sharing
Although Telegram's founder Pavel Durov remains under house arrest in France, the company continues to win support from investors.
Navigating Web3 tides with focused insightsCompiled by: Felix, PANews
On May 29, according to sources, the instant messaging app Telegram will raise at least $1.5 billion through bond issuance. In addition, Telegram's founder announced a $300 million deal with Musk's xAI (not yet formally signed).
Driven by consecutive positive news, TON, the native token of The Open Network under Telegram, surged briefly. According to CoinGecko data, Toncoin (TON) spiked to around $3.7, up approximately 23%, currently trading at $3.32. Although prices retreated after Musk clarified that no agreement had been officially signed, the 24-hour gain remains at 11.2%.
Plans to Issue Bonds to Raise $1.5 Billion
Sources revealed that Telegram will issue five-year bonds with a yield of 9%. The company plans to use the proceeds to repurchase its remaining bonds issued in 2021, which are due to mature next March. Previously, the company had used cash to repurchase about $400 million of such bonds.
Investors include existing Telegram bondholders such as U.S. asset management firm BlackRock and Abu Dhabi state investment company Mubadala. New investors are expected to include hedge fund Citadel.
As with previous Telegram bond offerings, if the company decides to go public, new bondholders will have the option to convert their debt into equity at a discount. However, given legal uncertainties surrounding founder Pavel Durov and market volatility, an IPO in the near term is unlikely.
Reached Cooperation Intent with xAI, Eligible for Equity and Subscription Revenue Share
In addition to planning to issue $1.5 billion in bonds, Pavel Durov stated on X that Telegram will gain a new revenue stream: a one-year agreement to distribute Musk’s xAI artificial intelligence model Grok (integrating the Grok chatbot into Telegram). In return, Telegram will receive $300 million in cash, equity in the AI company, and 50% of subscription revenues from xAI sold via Telegram.
Additionally, Pavel Durov emphasized privacy. A user commented, "Hope user data remains secure." To which Pavel Durov replied, "User privacy is critical. It must be clear that xAI will only access data that Telegram users explicitly share with Grok through direct interaction."
Notably, later that day, Musk denied the announcement, responding that "no agreements have been signed." After the news broke, TON token prices dropped accordingly. In response, Pavel Durov said, "Correct, agreed in principle, but formal procedures remain to be completed."
Founder Entangled in Investigation but Revenue Momentum Strong
Pavel Durov was born in Russia and holds Russian, UAE, and French citizenship. In August 2024, Pavel Durov was arrested in France and is under investigation for allegedly failing to assist police in combating crime. Although Pavel Durov has been released on bail, he cannot leave France without permission during the investigation.
On May 12, Pavel Durov applied for special exemption to travel to the U.S. to negotiate with investors, but French prosecutors said the request was rejected because his travel reasons were "neither convincing nor reasonable." It remains unclear how long Pavel Durov will remain restricted in France.
Notably, despite legal risks facing founder Pavel Durov, Telegram's development has not been significantly affected.
According to sources, Telegram informed investors that its 2024 revenue reached $1.4 billion, with profits of approximately $540 million, marking a strong rebound from the previous year's poor performance. Telegram reported $342 million in revenue and a $173 million loss in 2023.
In addition, Telegram executives said that as of March 2025, Telegram has 1 billion active users and over 15 million paying users, doubling in the past year. 2025 revenue is projected to reach $2 billion, with profits exceeding $700 million.
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