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A secondary market has emerged for buying and selling Telegram tokens early
- ChicagoBoy11 9y agoDoesn't sound like it has become a mess but rather just a huge windfall for a lot of people and tons of capital raised by Telegram.
- wellboy 9y agoFake news. All that happened is that they didn't open up to ordinary investors, so their initial investors need to wait until the token hits exchanges to make gainz. Bad article, FUD spreading.
- __jal 9y agoAt this point, using the phrase 'fake news' causes me to immediately heavily discount the reliability of the speaker and the validity of whatever it is they apparently want me to believe.
- gowld 9y ago"Fake news" is just a modern was of saying "I don't believe it."
- wellboy 9y agoThen you've been manipulated by Trump who says fake news to everything, so that it looks as if he's calling bad reporting out even though he is the biggest fake news spreader. Have you thought about that? It's the same as turkey calling other countries dictatorships and Nazis, so that they can't be called that. It's a very common manipulation strategy.
- sschueller 9y agoDoesn't sound too bad to me. They raised $1.7 billion. "Added to that, the fact that Telegram isn’t in control of the flow of capital at this early stage doesn’t look good." I don't understand that, why would they not have access to the capital which they raised? Didn't they sell the tokens? What a shit article, could at least provide some details.
- lacker 9y agoYeah the article describes this a bit confusingly. They do have access to the capital they raised, they just don't have control over the subsequent flow of capital in and out of these tokens. For example: One source said an early investor who acquired a tranche of tokens at a price of $0.37 is actively seeking to sell for $1.30 — potentially a 3.5-fold increase for a token that hasn’t left the gate yet. That sort of flipping (or "capital flow") isn't typically possible in startup fundraising because investors are restricted from selling their stock. For a normal startup it would look bad if your investors wanted to sell their stock immediately because they would be signaling a lack of confidence in the future. For this Telegram ICO, it isn't quite the same, but some people might look at it as a bad sign in a similar way. To me, it is hard to tell what the underlying basis for any valuation of this ICO is.
- gowld 9y agoIf investors sell at a loss, that shows a lack of confidence. Selling at a gain means the investor thinks the stock is plateauing (not growing as quickly as before), not necessarily bad if the stock already has a $billion valuation and other investors are looking for a lower return (lower risk?) investment than the the original investor. An ICO is more like an IPO than a seed round, in terms of who buys in. And early investors / insiders quite commonly sell fine stocks shortly after IPO. None of this is a comment on the quality of Telegram in particular.
- cwkoss 9y agoCould also mean that investors are covering cost, but still keeping part of their position. Ex buy at 0.30. Price goes to 1.2, sell 25% of holdings to cover cost, but let profit ride. As the saying goes, "Can't lose money by taking profits".
- Legogris 9y agoThe only explanation model I have for this round is money laundering. Can someone with more insight enlighten me on what would make someone seriously invest in this with more than pocket change?
- repomies69999 9y agoWell most ico investors are just totally irrational. It is mostly fueled by the meteoric risw of cryptos in general. People are just throwing money around. Of course money laundering might be involved as well.
- lacker 9y agoOne source said an early investor who acquired a tranche of tokens at a price of $0.37 is actively seeking to sell for $1.30 — potentially a 3.5-fold increase for a token that hasn’t left the gate yet. People believing they can make a 3.5-fold increase is what makes them invest.
- gowld 9y agoNaive question: Does "selling" a token generate cash, or some non-/semi-liquid "money" sitting in a database of an unlicensed broker/exchange like a MtGOX?
- conanbatt 9y agoYou normally can exchange into bitcoin and sell out, so yes, it is cash.
- nostrademons 9y agoOn most of the exchanges that deal in ICOs, they're usually traded for other cryptocurrencies like Bitcoin or Tether. These are "funny money" in the sense that they're unbacked by any assets or hard currency, but are liquid in the sense that you don't have any practical problem finding a buyer for them. (This is changing rapidly, BTW, since Coinbase and other licensed crypto-to-fiat exchanges have recently announced support for the ERC20 tokens that ICOs typically use.) In practice it's not much of a problem, because you sell your ICO tokens for Bitcoin and then you sell your Bitcoin for dollars/yen/won/euros at a licensed crypto-to-fiat exchange like Coinbase, Bitthumb, Gemini, etc. You do lose anonymity because all the fiat exchanges have KYC identity-verification procedures, but each step of the transaction is legal (for the ICO buyer), so there's little risk.
- matte_black 9y agoWhat happens if the SEC classifies this coin as a security?
- Analemma_ 9y agoThen Durov will be a fugitive in two major countries. I wouldn't envy him then. As a general rule, if you're going to pick a fight with one superpower, try to be like Snowden and make sure that you can still take refuge in a different one. By contrast, Julian Assagne is what happens when you make enemies everywhere.
- ryanlol 9y agoDurovs are agents of the Kremlin, not fugitives.
- solarkraft 9y agoElaborate. Doesn't seem like it.
- ryanlol 9y agoHow do you mean? Telegram was developed in VKontakte offices in St. Petersburg Durovs have spent years doing a poor job of pretending to live in exile from Russia whilst regularly visiting their offices there. Telegrams encryption implementation is deliberately broken. Telegrams DH implementation was delibrately backdoored https://habrahabr.ru/post/206900/ https://habrahabr.ru/post/206900/ Honestly, “doesn’t seem like it” is complete bullshit. Once I get off my phone I’ll add more sources to this comment, but everything I said is easy to confirm with google.
- icebraining 9y agoHere's the discussion of that link in HN at the time: https://news.ycombinator.com/item?id=6948742 https://news.ycombinator.com/item?id=6948742
- paulie_a 9y agoIt's an ICO therefore by definition it is a mess.
- robinhood 9y agoUp to that point I was naive, thinking that Telegram would remain a simple messaging platform without the ambition to either raise money or make money at all - as it was the initial philosophy which attracted me to the platform in the first place. Now I'm concerned that it will become a bloated software. I hope M. Durov will keep his vision of providing a simple messaging client that just work - because we desperately need one.
- ct0 9y agoLucky there are plenty of options in this space. Maybe telegram just has the most features with a huge user base which sets it apart. Signal isnt bad.
- mjburgess 9y agoSo you expected volunteers to keep the service running?
- robinhood 9y agoI didn't say that. They weren't volunteers - they are all employees, funded by the billionaire who didn't want initially that American companies ruled the messaging space.
- AndrewKemendo 9y agoIn this case you're suggesting the billionaire be the one who is the volunteer. Or rather are you considering it a charity project funded by one donor?
- AndrewKemendo 9y agoRealistically I don't think what you mention is possible without the company being State run. No matter what, an organization needs income. Either donations our business revenue. In any case, because there is competition, when if the service is simply maintained costs will inevitably rise. Arguably raising a war chest is the best way to stay smooth sailing. I think there is a false belief that there is a world where it's possible to build and maintain quality software, specifically wide scale free consumer software, that doesn't need massive scale to survive.
- omegbule 9y agoThe guys running Telegram are a lot smarter than the whoever wrote this article.
- 21 9y agoNo shit. Taleb would say: "those who can, do. those who can't teach others or write about others doing it". Just look at the financial press which is the last place you should look for market analysis.
- usrusr 9y agoNot really universal though: maybe some people who write about axe-murderers would be really good at axe-murdering, but for some reason they never tried. (At the opposite end of the spectrum you have professional sports and those who write about it)
- deleted 9y ago[deleted]
- alex_young 9y agoSomeone help me here. What do you get if you've 'invested' in this ICO? Some kind of enforceable ownership in the company? Voting rights? Something else?
- ryanlol 9y agoEssentially nothing.
- cwkoss 9y agoI don't think the validity of company ownership based on holding tokens has been tested in the courts yet, so we don't really know. Will be interesting when a company sells tokens, becomes very successful, then decides they want to change the terms of their previous sale. Clearly, billions of dollars could be on the line - eventually some company is going to become very successful, get greedy and smartly raise the ambiguous question of whether they are legally bound by token sale obligations. Have any companies that have ICO'ed reflected their token sales in their company bylaws? I think the 'legal API' between token ownership and enforcement in courts is an interesting problem.
- jMyles 9y ago> I don't think the validity of company ownership based on holding tokens has been tested in the courts yet, so we don't really know. Well, I think that if the matter of company ownership comes down to a decision by a court, then the token didn't really function as it was supposed to. The point of (or at least, one of the points of) smart contracts is to be the enforcement agent for the terms of an ERC20 token. Of course, we're not there yet, and for that reason, it's a silly / premature to suppose that an ERC20 token can represent true ownership.
- vageli 9y ago> The point of (or at least, one of the points of) smart contracts is to be the enforcement agent for the terms of an ERC20 token. > Of course, we're not there yet, and for that reason, it's a silly / premature to suppose that an ERC20 token can represent true ownership. When put this way I can't see the future of smart contracts ever being fully realized. Humans rely on humans for final arbitration and take issue with automatic enforcement of rules without opportunity for appeal. The appeal mechanisms I've seen still rely on humans (mechanisms like multi-signature transactions with an escrow user as a signature). Ultimately, unless all of your property is entirely digital or informational in nature, governments will be forever able to use violence or the threat thereof to compel you to relinquish whatever property they wish.
- luka-birsa 9y agoI can't put this in nicer words than what a shitty article. - Telegram might have opted to cancel the public sale due to recent events on how SEC and CTFC perceive tokens (they are more and more viewed as security) and in that case, it's better that all tokens are sold to professional investors. - Just because there is a demand for TON tokens which will, in turn, create a secondary "gray" market doesn't mean that the ICO is a mess. It's just that they decided not to sell to the public. - You might love or hate what Telegram is doing with the ICO (I'm more on the hate part of the spectrum), but the fact remains - Telegram just raised 1.7B without diluting and it seems that both Telegram and the speculative investors are very happy about that. How that can be construed as a mess is beyond me. Doing a "me-too" ICO with a bunch of buzzwords thrown in is such an obvious money grab and I would prefer that they simply integrate Ethereum directly in Telegram, but you can't deny their position as the go-to communication tool of the Crypto community (Wechat being the second in line). They are just capitalizing on their position and re-positioning themselves as a Wechat clone, but built on crypto instead. edit: formatting
- gfody 9y ago> I would prefer that they simply integrate Ethereum looks like TON is has its own proof-of-stake system, so it's competition for Ethereum. is that why Russia is blasting it off the internet?
- luka-birsa 9y agoIt's more likely due to the fact that the Telegram founder is waging a war with Russia and publicly denying them access to Telegram. PS: I'm still not convinced all of this is not some charade, but then again I don't trust anybody that build communication tools, so do take the charade comment with a grain of salt.
- baby 9y agoThey are publicly denying them access? Source? Beside a PR statement?
- 9y ago
- rossdavidh 9y agoTIL raising $1.7Billion without even selling any stake in your company, is a mess, and something to be avoided.
- alex_young 9y agoDoesn't sound like a horrible thing for them. They have $1.7B they are now unaccountable for right?
- dumbfounder 9y agoMethinks Ross is speaking facetiously...
- cornholio 9y agoI think we are allowed to call a financial get-rich-quick scheme a "mess" only after the Greater Fool™ game starts to run out of fools. Here we seem to be in the full swing of the fool supply curve, the irrational exuberance and speculative mania phase.
- jboles 9y agoICOs in a nutshell: http://southpark.cc.com/clips/410872/erics-jewelry-calvacade http://southpark.cc.com/clips/410872/erics-jewelry-calvacade
- deleted 9y ago[deleted]
- dang 9y agoSince people are complaining that the article is misleading, we changed the title to more factual text from the article.
- skybrian 9y agoCould they run into the same problem Facebook ran into? If they have too many private investors, they have to go public.
- icebraining 9y agoThis ICO is not an investment in the company. The buyers don't get any equity, just the tokens.
- Keeeeeeeks 9y agoIsn't this what happens when the company says "no public sale" after you've already bought in?
- lostmsu 9y agoNo joke. I'd like to see those people, who paid $1.7B for a promise of a better messenger, and a PoS cryptocurrency, that is not decentralized (e.g. like Ripple).