Telegram, the company co-founded by Pavel Durov, the Russian-born billionaire who has been indicted in France for allegedly failing to control criminal content on his platform, derives a significant share of its revenue from crypto-related operations.

What Happened: Telegram’s 2023 financials reveal that a significant portion of its revenue comes from crypto transactions. The company, incorporated in the British Virgin Islands, reported $342.5 million in revenue last year, despite an operating loss of $108 million, according to a Financial Times report.

Telegram’s revenue breakdown shows that over 40% comes from its "integrated wallet" and "sale of collectibles" line items, both closely tied to cryptocurrency. The integrated wallet is a software program that allows users to store, send, receive, and trade crypto assets. The company also sells different collectibles in exchange for Toncoins, a digital asset.

The TON blockchain, which underpins Toncoins, was originally developed in-house at Telegram. Digital assets make up a large portion of Telegram’s assets, valued at nearly $400 million.

Despite its heavy reliance on crypto and substantial liabilities, Telegram, wholly owned by Durov, has raised over $2.3 billion from blue-chip investors. The company’s valuation, according to Durov, exceeds $30 billion.

Also Read: Telegram CEO Pavel Durov Formally Charged By Judge In France Amid Rising Tensions With Russia — Bail Set At $5.6M

Why It Matters: The arrest of Durov raises questions about the future of Telegram, especially given its heavy reliance on cryptocurrency.

The company’s significant revenue from crypto transactions underscores the growing influence of digital assets in the tech industry, as evidenced by the drop in Toncoin’s (CRYPTO: TON) price following Durov’s arrest.

Despite these challenges, Telegram’s ability to attract significant investment indicates confidence in its long-term prospects.

What’s Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.

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