The Elephant in the Room: Exploring the Development Context and Future Potential of the TON Ecosystem

Since the beginning of 2024, the TON chain ecosystem has shown an explosive trend. From May 25 to June 17, Toncoin reached a maximum increase of 79.7%, Notcoin reached a maximum increase of 700%, and Fishcoin reached a maximum increase of 400%. The TON ecosystem has demonstrated a strong wealth effect, attracting a large influx of funds. This article will provide a detailed overview of the development history, core logic, and ecosystem construction of TON.

1. Project Background

Basic Information

Name: TON( The Open Network )

Founders: Pavel Durov, Nikolai Durov

Operations Team: TON Foundation

TON is a decentralized first-layer blockchain designed for billions of users, featuring scalability and sharding capabilities, aimed at addressing issues like high transaction fees, slow transaction speeds, inter-chain communication, and scalability in blockchain. Currently, the main operating team of TON is the TON Foundation, a non-profit organization whose goal is to enable 500 million users to have their own digital identity, data, and assets by 2028. Backed by Telegram, the TON chain is a crucial means to achieve this goal. Although TON is currently developing rapidly, its journey has faced many challenges.

Overview of Development History

● In 2017, the project was launched: Telegram founders Pavel Durov and Nikolai Durov began developing a blockchain project called Telegram Open Network (TON) and planned to launch the native cryptocurrency Gram.

● In 2018, Initial Coin Offering (ICO): Telegram raised approximately $1.7 billion through its ICO, becoming one of the largest token offerings at the time.

● In 2019, development progress: the TON blockchain introduced sharding technology to improve scalability and processing speed.

● In 2020, regulatory issues and project turning points: Telegram announced its withdrawal from the TON project, transferring the development work to an independent open-source developer community. The project was renamed "The Open Network" and the token name was changed to Toncoin. Funds raised from the ICO were refunded.

● In 2021, community takeover and development: The TON Foundation took over the project and continued to promote the development and promotion of TON.

● In 2023, returning to Telegram: Telegram officially announced that the TON blockchain will be its preferred Web3 infrastructure and plans to integrate it into the user interface of the Telegram application.

● In 2024, the ecosystem expansion: The application ecosystem of the TON blockchain continues to expand, covering multiple fields such as finance, storage, payments, and domain names. Projects like PunkCity, PUNK, and HyperGPT within the TON ecosystem have begun to receive widespread attention from the market. In February, Telegram announced that it would exclusively use the TON blockchain and Toncoin for all transactions and payment activities with channel owners.

User-Centric Core Narrative

Throughout the development of TON, the influence of Telegram has always been present. While most public chains promote innovative technologies, the TON chain relies on the 900 million monthly active users of Telegram, emphasizing user needs and convenience.

Telegram is no longer content with merely being a social communication platform. By enriching its product line, integrating payments with daily life, and offering highly potential Bots, it is attempting to transform into a comprehensive platform. This strategic shift showcases Telegram's ambitions and heralds the enormous potential of the TON public chain in the future.

Telegram currently has over 1.3 billion registered users and 900 million monthly active users. Freedom of speech and privacy protection are the core values of Telegram, making it a gathering place for the cryptocurrency community—almost all Web3 projects have Telegram communities. Telegram's Web3 environment provides significant support for the TON chain ecosystem, laying the community foundation for its ecosystem projects from incubation to ICO.

Market Acceptance Analysis

As of the time of writing, the market cap of the TON blockchain has reached $18.759 billion, ranking it as the ninth largest cryptocurrency. The TVL of the TON blockchain has grown rapidly since April, currently reaching 605.72m USDT, ranking 15th among public chains. Although the TVL of the TON blockchain is growing quickly, it has still not caught up with its market cap, leaving significant room for improvement.

2. Financing Information

● In 2018, the first ICO raised 1.7 billion USD, but returned part of the funds due to a SEC lawsuit.

● In April 2022, Huobi Incubator, KuCoin Ventures, and MEXC Pioneer Fund jointly invested $250 million to establish the TON Foundation, focusing on supporting DEX and NFT projects on the TON blockchain.

● In October 2023, MEXC Ventures provided tens of millions of dollars in investment to promote the adoption of the Web3 ecosystem on Telegram.

● In November 2023, Animoca Brands invested in funding, research, and analysis platforms to support third-party mini-programs and game projects within the TON ecosystem, while also becoming the largest validator.

Telegram initially focused on protecting user privacy and lacked clear revenue channels, raising hundreds of millions of dollars through bond issuance to maintain operations. Starting in 2022, Telegram began exploring revenue models and recently announced that it is close to achieving profitability. In 2023, Telegram founder Pavel Durov proposed a plan to conduct an IPO within the next two years, with the company's valuation now exceeding $30 billion, potentially choosing to list in the United States.

Whether it's TON or Telegram, both are currently in a stage of vigorous development. Investing in the TON ecosystem is equivalent to recognizing the enormous potential of the Web2 social platform Telegram transforming into a Web3 comprehensive platform.

3. Technical Characteristics

Programming Language

TON blockchain smart contract development does not use popular languages such as Solidity, Rust, or Vyper, but instead adopts three programming languages: Fift, FunC, and Tact. Fift is oriented towards low-level development, focusing on runtime efficiency but with a high level of difficulty; Tact is a new high-level language introduced by TON, with syntax similar to TypeScript, aimed at reducing development difficulty; FunC is similar to the C language and is currently the preferred development language. Given the efficiency of Tact development, mainstream developers may shift towards using Tact in the future.

Cutting-edge technology

● Asynchronous Calls of Smart Contracts: TON's smart contracts adopt an asynchronous model, enhancing the system's scalability. Calls are not executed immediately, and it is not necessary to complete all transaction processing within a single block. However, this mechanism also increases the complexity of developing and maintaining applications.

● Infinite Sharding: The TON blockchain is divided into the main chain (Masterchain), working chains (Workingchains), and shard chains (Shardchains). The main chain is responsible for storing the global metadata and consensus mechanism; working chains handle specific types of transactions and smart contracts; shard chains are sub-chains of the working chains, further dividing the workload to enhance processing capacity and scalability.

● Privacy Protection: The TON blockchain utilizes TON Proxy to hide node IP addresses, combined with TON DNS and the TON P2P network, to build a decentralized VPN service to protect user privacy.

Relative Advantage

TON integrates various technologies, surpassing Ethereum and Solana in multiple metrics such as transaction confirmation time.

Four, Market Analysis

Token Economics

● Token Function: $Toncoin is positioned as the native token on Telegram. It can be used on Telegram to pay membership fees and purchase virtual products. On the TON blockchain, it can be used for transaction fee payments, staking, cross-chain transactions, decentralized data storage, proxy services, and more.

● Token Supply: The maximum supply of $Toncoin is 5 billion. On June 28, 2022, all $Toncoin were mined, marking the complete transition of TON from PoW to PoS mode. An annual token inflation of 0.6% (approximately 3 million tokens) is used to reward validators.

● Token Distribution: Of the initial 5 billion $Toncoin, the team received 1.45%, while miners earned 98.55%. In February 2023, TON initiated a community proposal to freeze 171 inactive early wallets for 48 months, totaling 1.08B $Toncoin (approximately 21% of the total supply).

Secondary Market Analysis

● Market Cap: As of June 3, 2024, the market cap of $Toncoin is $18.759 billion, ranking 9th, with a fully diluted market cap of $39.382 billion, a circulating supply of 2.432 billion coins, and a total supply of 5.107 billion coins.

● Chip distribution: 85.45% of holders own $0-$1k $Toncoin, 14.16% own $1k-$100k $Toncoin, and 0.38% own more than $100k $Toncoin. Whales hold 68.68% of $TON, while retail investors hold 31.32%. 29.20% of holders have held for over a year, and 16.7% have held for no more than one month. The top 10 addresses hold 29.99% of $Toncoin.

● Trend: In the past year, the price of $Toncoin has risen from 12.4071 yuan to 56.54 yuan, an increase of over 400%, reflecting the strong market expectations and wealth effect of the TON chain.

Five, Ecological Construction

The TON ecosystem currently has over 500 Dapps and a large number of Telegram Bots, covering popular areas such as infrastructure, development tools, DeFi, GameFi, NFTs, SocialFi, inscriptions, and more. The vertically segmented tracks include Launchpad, wallets, cross-chain bridges, staking and lending, DEX, various chain games, collectibles, and more.

Eco Assistant Telegram Bot

The Telegram Bot is an automated bot running on Telegram that plays an important role in community building, asset management, information aggregation, and project promotion. It can provide users with the latest crypto news, manage community activities, simplify DAO governance processes, and improve the efficiency of project information transmission. For TON ecosystem projects, the Telegram Bot allows 900 million users to participate in project airdrop activities without barriers, helping to promote them.

DeFi leader STON.fi

STON.fi is the largest DEX on the TON blockchain, supporting trading for over 280 trading pairs. It utilizes AMM, RFQ, and HTLC technologies, inheriting Uniswap's low slippage characteristics while enhancing trading reliability and security.

The STON.fi token is $STON, with a total supply of 100 million pieces. Since February, the TVL has experienced explosive growth, currently reaching 262.2m USDT, ranking third in the TON ecosystem.

Launchpad leader TonUP

TonUP is a star asset issuance platform based on the TON blockchain. Established in August 2023, it completed its first IDO and received investments from well-known funds such as TONCoin Fund and Foresight X. TonUP has strong crisis management capabilities and performed excellently during the $MC token incident. Currently, 99.66% of tokens are concentrated in the project party's address, indicating ample project reserves and significant potential for future development.

Telegram Wallet and Tonkeeper

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