Communication apps that integrate payment features, like WeChat and Line, have seen tremendous success. With Telegram’s 950 million monthly active users, it raises the question: Could Telegram be the next major player in Web3 payments?
What is TON?
Brief overview of TON
You may not have used blockchain services before, but you’ve probably heard of the communication software “Telegram”. Telegram was initially designed for secure messaging and data transfer but has now grown into a complete blockchain system.
TON（pronounced “tong”）, or the Telegram Open Network, is a blockchain platform created by Telegram.
$TON’s Tokenomics and distribution
TON’s tokenomics and distribution model are essential parts of its economic system.
Initial Supply:
- The total initial supply of TON was 5 billion tokens.
Mining Phase:
- Began on July 6, 2020, using the Proof of Work (PoW) mechanism.
- Ended on June 28, 2022.
- This phase distributed 98.55% of the total supply.
Team Allocation:
- 1.45% of the supply was allocated to the team.
Transition to Proof of Stake (PoS):
- After mining, the network shifted to a PoS consensus mechanism.
- Validators now receive TON tokens as rewards.
Supply Growth:
- The total supply increases by approximately 0.6% per year.
(Source: M3TA)
Token Distribution and Economic Model:
- The team retains 1.45% of the total tokens, with the remaining 98.55% having been mined through Proof of Work (POW) in the early stages.
To mitigate concerns about token concentration, the team implemented the “TON Token Economic Model Optimization Proposal,” which was approved in February 2023.
This proposal included freezing inactive wallets for 48 months, impacting 171 wallets holding over 1.081 billion TON (21% of the total at that time). Additionally, a considerable amount of TON was resold at discounted rates.
What is Ton’s Main Feature?
TON has several standout features:
- Huge User Base: Leveraging Telegram’s extensive user base( 950 million monthly active users ), TON aims for broad adoption and accessibility. Without incurring user migration costs, TON leverages Telegram’s existing social network to reconstruct Web2 business models in a Web3 manner.
- Scalability Solutions and High TPS (Transactions Per Second): TON’s infrastructure is designed to handle a high volume of transactions efficiently.
- Community-Driven and Autonomous: TON’s development relies more on the efforts of the community and independent developers, enhancing its community-driven and autonomous characteristics.
- In-App Self-Custodial Wallet: TON provides a secure, self-custodial wallet for users to manage their assets independently. The Telegram Wallet facilitates direct purchases of $TON using credit cards. Users can spend $TON to obtain digital goods, such as Mini Games services. $TON is also used for transaction fees and staking.
How Does Ton Work?
TON’s functionality can be better understood by comparing it to other blockchains. It offers several advantages and some drawbacks:
(Source: M3TA)
Pros:
- High transaction speed and scalability
- As a high-performance public blockchain, the TON blockchain achieved over 104,000 TPS in performance tests, setting a new record for blockchain transaction speeds. (The results were obtained under ideal testing conditions)
- Complex transactions performance
- TON surpasses Ethereum and Solana in handling complex transactions due to its dynamic sharding capabilities. This design allows for parallel processing and efficient resource allocation, leading to higher throughput and reduced latency.
- Sharding support and cross-shard communication
- TON has quick and efficient cross-shard communication, allowing shards to work together seamlessly.
- Cons:
- Regulatory challenges
- In 2019, the U.S. SEC filed a lawsuit against Telegram, alleging that its unregistered securities sales violated U.S. securities laws. This posed a significant obstacle for the TON project.
- In 2019, the U.S. SEC filed a lawsuit against Telegram, alleging that its unregistered securities sales violated U.S. securities laws. This posed a significant obstacle for the TON project.
- Regulatory challenges
In 2020, facing legal and regulatory pressures, Telegram announced its withdrawal from the TON project. Founder Pavel Durov publicly stated that Telegram would no longer be involved in the development of TON.
Currently, several independent projects related to TON are in operation, all driven by the community rather than being directly controlled or managed by Telegram.
- Competition with Layer2 blockchains
- TON is working in a tough market with newer layer2 projects. To stay relevant and attract users, it needs to keep innovating.
Also, because of its unique design, the TON Virtual Machine doesn’t work with Ethereum’s Virtual Machine. This means TON can’t directly use Ethereum’s wide range of development tools and decentralized apps.
- TON is working in a tough market with newer layer2 projects. To stay relevant and attract users, it needs to keep innovating.
Ecosystem and Applications on TON
TON supports a diverse range of applications and projects within its ecosystem:
DEX – STON.fi
STON.fi is an Automated Market Maker (AMM) Decentralized Exchange (DEX) built and developed within the TON ecosystem, currently holding the 1st spot in Total Value Locked (TVL) with $360 million.
It specializes in zero transaction fees, low slippage, an intuitive GUI, and full wallet support for TON.
DEX – DeDust
DeDust, established in 2022, is the leading decentralized exchange (DEX) in the TON ecosystem, currently holding the second spot in TVL with $344 million which is close to the STON.fi. DeDust offers trading services for 75 different cryptocurrencies and 1,054 trading pairs.
DEX – Blum
Founded by a former Binance VP, Blum is a hybrid crypto exchange accessible through a Telegram mini-app. It combines the best features of both centralized and decentralized exchanges. Blum is also set to launch a memepad, allowing users to create and launch meme coins directly from the platform.
Wallet – Tonkeeper
Tonkeeper is a non-custodial wallet for the TON blockchain. It stores cryptocurrency keys directly on the user’s device without requiring documents, personal information, contact details, or KYC.
Users can purchase Toncoin directly within the Tonkeeper app and exchange it on decentralized markets.
Lending Protocol – Evaa
Evaa is the first decentralized lending protocol on TON, offering a P2P lending service where you can lend your assets and earn interest, or borrow against collateral through smart contracts.
Also, Evaa Protocol has raised $410K from investors including WAGMI Ventures, TONcoin.fund, and Existential Capital in the pre-seed round.
GameFi – NOTCOIN
Telegram’s first well-known project, the Notcoin Community on Telegram, boasts a staggering 7.83 million members, a scale difficult to achieve for both Web2 and Web3 projects.
Notcoin was officially launched on January 1, 2024, and within a week, the number of players reached 4 million, making it one of the fastest-growing GameFi projects in history.
This click-to-mine mini-game was available for only three months, ending on April 1, 2024. Afterward, users can convert the Notcoins they earned in the game into NOT tokens, with an exchange rate of 1 Notcoin for every 1,000 game coins.
In total, the number of Notcoin players exceeded 35 million, with a total of 88 trillion clicks.
Launchpad – TonUp
Potential GameFi Token Airdrops
Following the success and widespread attention of NOTCOIN, the cryptocurrency market has developed even greater expectations for the TON ecosystem. Other projects within the TON ecosystem have also received considerable attention. Here are some projects that may become the next viral marketing cases:
Hamster Kombat
Very Similar to NOTCOIN, by clicking on the hamster on the screen in Telegram, users can earn gold coins, which can be used to enhance exchanges and upgrade hourly profits. The gold coins accumulated will allow them to receive token airdrop rewards. Besides, players can also increase their earnings by subscribing to Telegram channels and inviting friends.
Catizen
Catizen is a cat-themed game built on the TON blockchain. With its cute and attractive cat theme, it draws many players to earn their token. In this game, you can expand your cativerse by feeding, breeding, and fishing with your cats. The more tokens you earn, the more airdrop tokens you will receive.
X EMPIRE
X Empire is an entrepreneur simulation game where your goal is to climb the ladder of entrepreneurial success and level up your character(Elon Musk).
Over 30M telegram app users, 11M subscribers on X Empire Telegram Channel
Yescoin
YesCoin is the first “swipe-to-earn” app in the TON ecosystem. It has gained significant popularity and has already secured numerous partnerships with top-tier exchanges, organizing joint events with them.
Summary
In short, TON represents a significant development in the blockchain space, leveraging Telegram’s massive user base and innovative technology.
With over 950 million monthly active users, TON provides a unique bridge between Web2 and Web3 ecosystems. Despite early regulatory challenges, TON has continued to evolve through community efforts, offering high transaction speeds and decentralized solutions.
About XY Finance
XY Finance is a cross-chain interoperability protocol aggregating DEXs & Bridges. With the ultimate routing across multi-chains, borderless and seamless swapping is just one click away.
XY Finance Official Channels
XY Finance | Discord | Twitter | Telegram | Documents | Partnership Form