Russian state fund invests in Telegram as part of messenger’s $1bn fundraising drive, despite country once trying to ban service

A controversial and increasingly popular messaging app has attracted more than $1 billion from new investors, its founder has announced, with Russia’s sovereign wealth stash said to be among those putting cash into the business.

A representative of the Russian Direct Investment Fund (RDIF) confirmed to RIA Novosti on Tuesday that it had “participated in the investment in Telegram together with the Mubadala Investment Company.” The RDIF later clarified that it had acquired a minority stake in Mubadala’s purchase of the company’s bonds as part of a Russian-UAE joint effort.

The founder of Telegram, Pavel Durov, who is from St. Petersburg, had revealed earlier on Tuesday that the company had “raised over $1 billion by selling bonds to some of the largest and most knowledgeable investors around the world.” The extra capital, he said, “will allow Telegram to continue its global growth while maintaining its values and independence,” and giving the service an opportunity to monetize itself. “Telegram’s ultimate goal is to become a financially sustainable project that can serve humanity for decades, or centuries, into the future,” he added.

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However, the RDIF’s acquisition of a share of the firm appeared to cause some confusion for the company, which backtracked on confirmation that the fund had become a shareholder. It is unclear whether this was due to the fact the Moscow-based investor bought shares through a UAE partner, or an attempt to distance Telegram from Russian state funds.

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The company has already fought a series of legal battles in Russia over access to information. In 2018, a court ordered the app to be blocked after a dispute with the country’s top domestic security agency, the FSB, which had demanded a back door to the encrypted service’s data in order to monitor criminal activity. Telegram said this was not possible, as even those running the platform cannot see users’ chats. The ban was ineffective, and the messenger went offline for only a few hours before returning.

In January, the app, which boasts advanced security options such as “self-destructing messages” for those “looking for extra privacy,” shot to the top of downloads charts after rival WhatsApp introduced a controversial new measure in its terms and conditions. The new rule would see users’ information handed over to tech giant Facebook, which acquired the service in 2014. Amid widespread criticism, WhatsApp was forced to clarify that the content of chats and profile data would not be passed on.

However, in a statement issued to RT later on Wednesday, a Telegram spokesperson repeated the claim that RDIF “is not on the list of investors we sold bonds to,” adding that “we wouldn’t be open to any transaction with this fund.” However, they again clarified that the sovereign wealth foundation bought a small quantity of Telegram bonds in the secondary market.

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