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CGV Research2024 | Kickoff: Key Drivers & Future Projections for the TON Eco

Produced by: CGV Research

Author: Shigeru



Introduction:

With the arrival of the summer of 2024, the TON network has shown unprecedented growth momentum, with daily active addresses, transaction volume, and total value locked (TVL) reaching new highs. These achievements indicate that the golden decade of the TON ecosystem has set sail. The CGV Research team deeply explores “the explosion of the TON ecosystem,” analyzing the key drivers from both internal innovations and external market factors that have propelled it to become a leading blockchain platform.


As we enter June 2024, every day sets new records for the TON in terms of users, transaction volume, and TVL:

— The number of daily active addresses on TON has surpassed Ethereum for several consecutive days;

— TON’s total value locked (TVL) has broken through $600 million, increasing a thousandfold since 2024;

— In 47 days, $450 million in $USDT was issued on TON;

— Steve, the chairman of the TON Foundation, suggested that a hallmark of crypto’s mass adoption is the creation of the first TON mini-app with 100 million Telegram users; Hamster Kombat achieved this the very next day.

The CGV Research team believes that the arrival of TON summer 2024 benefits from both “internal” and “external” positives of TON.


Internal Drivers from TON Eco

Wallet Innovation: In July 2023, TON launched a new wallet payment feature, allowing users to conduct various transactions and payments through the TON wallet, enhancing the user experience. In September, TON launched TONSpace, a self-hosted wallet allowing users to manage their own private keys and assets. By December, a secondary wallet entry was added to the Telegram app, making it more convenient for users to use the TON wallet within Telegram.

— Token Lock-Up Strategy: Early in 2023, the TON community and validators decided through on-chain voting to freeze the wallets of inactive miners, which accounted for about 21% of the total supply, locked until February 2027. In October, the community launched the TON Believers Fund, a five-year lock-up plan where users could choose to donate their tokens or deposit them into a smart contract. This action locked up 26% of the supply, totaling about 47% of TON tokens locked for three to five years, effectively reducing the market’s circulating supply and stabilizing the token price.

Native USDT Deployment on TON: In April 2024, Tether announced the introduction of USDT to the TON network, adding USDT-related transactions and financial activities to TON, providing strong support for DeFi applications. The issuance of USDT on TON quickly surpassed that on Cosmos and Near, becoming the network second only to Tron, Ethereum, Solana, and Avalanche.

Blockchain Performance Breakthrough: On October 31, 2023, TON reached a peak of 104,715 transactions per second in a public performance live test, processing a total of 107,652,545 transactions. This performance, verified by CertiK, marked TON as one of the fastest and most scalable blockchains globally.

— Market Promotion: In the spring of 2024, by launching the #OpenLeague Super League with a total prize pool of $150 million, TON attracted a large number of users and market attention. Additionally, the revenue-sharing strategy implemented by the TON Foundation and Telegram, along with the listing of Notcoin on several major exchanges, greatly enhanced its market performance and brand influence.


External Factors for TON Eco

— Significant Investment from Pantera: In May 2024, Pantera made the largest single investment in history in the TON network, not only demonstrating recognition of TON’s technology and market potential but also likely attracting more capital attention and strengthening market confidence in the TON ecosystem.

— Global Competitive Environment and Market Demand: With Musk’s X app planning to introduce crypto payment features in mid-2024, TON faces pressure from global competitors. Moreover, the entire crypto market urgently needs new narratives and directions, and the TON ecosystem, relying on its innovative technology and applications, injects new vitality into the market.

— Demand for New Narratives: The crypto industry needs new narratives and directions. The social fission and flywheel effect brought by TON, leading to user and transaction volume growth, provides new vitality to the market.

In conclusion, the CGV Research team believes that the TON ecosystem may exhibit four major development trends in the future. These trends will shape the unique position of the TON ecosystem and may have a profound impact on the entire crypto industry.


TON Eco Next Step Trends

1. Telegram’s Full Ecosystem Expansion Bringing a Black Hole Effect:

Originally an instant messaging tool, Telegram has now evolved into a multi-functional platform integrating social, payment, service subscription, and mini-app functions. With TON joining, Telegram is rapidly advancing along a similar development trajectory.

- Upstream (Infrastructure and Development Platform): TON provides robust infrastructure and software development kits (SDKs), attracting developers to build and deploy decentralized applications (DApps), which may weaken other blockchain platforms’ development resources.

- Midstream (Application Layer and Services): Custom stablecoin solutions and micropayment systems within the TON ecosystem, along with the ability to seamlessly integrate mainstream crypto assets through official cross-chain bridges, provide users with a one-stop asset management and trading platform.

- Downstream (User Adoption and Market Expansion): Telegram’s large user base provides a market access point for TON. By establishing relationships with financial institutions, media companies, and retailers, Telegram can integrate crypto technology into broader economic activities.

2. Unregulated Barriers + Fastest Public Chain + Flywheel Effect, Making the TON Ecosystem Limitless:

TON’s global service capability, unrestricted by specific national or regional financial regulations, combined with its high performance and user growth flywheel effect, indicates that the potential of the TON ecosystem may have no upper limit.

- Traffic Monetization: Telegram’s traffic advantage will bring significant monetization potential to TON, especially in decentralized markets like Fragment, which has already facilitated significant transaction volumes.

- NFT Market: Telegram’s stickers turned into NFTs and traded via the TON blockchain indicate a massive emerging market.

- Web3 Project Revenue Realization: TON’s mini-apps are expected to become high-revenue Web3 projects, leveraging their large daily active user base.

3. Joining of Global Financial Giants: Mainstream Recognition of the TON Ecosystem:

As the TON platform matures and achieves cross-chain functionality, it may attract the attention of traditional financial institutions, encouraging them to explore blockchain technology and collaborate with TON.

- Financial Service Innovation: Financial institutions may migrate their services to TON or collaborate with TON, taking advantage of its low costs and high efficiency.

- Stablecoins and Financial Products: Financial institutions may develop new loan, insurance, and investment products on TON, or even create stablecoins linked to specific assets.

4. Shift in Investment Logic: Non-Essentiality of Token Economy:

The maturation of the TON ecosystem may change the investment logic of the primary market, making tokens no longer a mandatory element for crypto projects.

- Technology and Business Models: Projects may rely on more mature technology and business models to attract users and investors, rather than solely depending on the token economy.

- Regulatory Adaptability: Projects that do not issue tokens may more easily adapt to regulatory environments, avoiding potential legal risks.

- Investment Analysis: Future evaluations of TON ecosystem projects may focus more on actual user data and business performance, such as daily active users (DAU), user retention, and average revenue per user (ARPU), rather than just focusing on token unlocks and distributions.


These trends indicate that the TON ecosystem will not only consolidate its position in the crypto field but may also attract a wider user base and participation from traditional financial institutions, marking a new stage of development.


Conclusion

The rise of the TON ecosystem signals the future direction of cryptocurrency and blockchain technology. With Telegram’s deep integration and TON’s innovation-driven approach, we foresee a new ecosystem forming, which will not only change our understanding of financial services, social interaction, and digital assets but will also bring unprecedented convenience and opportunities to global users.



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About Cryptogram Venture (CGV):

CGV (Cryptogram Venture) is a crypto investment institution headquartered in Tokyo, Japan. Since 2017, its fund and predecessor funds have participated in investing in over 200 projects, including the incubation of the licensed Japanese yen stablecoin JPYW. CGV is also a limited partner in several globally renowned crypto funds. Since 2022, CGV has successfully hosted two editions of the Japan Web3 Hackathon (TWSH), supported by Japan’s Ministry of Education, Culture, Sports, Science and Technology, Keio University, NTT Docomo, and other institutions and experts. CGV has branches in Hong Kong, Singapore, New York, Toronto, and other locations. Additionally, CGV is a founding member of the Bitcoin Tokyo Club in Tokyo, Japan.



Disclaimer:

The information and materials introduced in this article are sourced from public channels, and our company does not guarantee their accuracy or completeness. Descriptions or predictions involving future situations are forward-looking statements, and any advice and opinions provided are for reference only and do not constitute investment advice or implications for anyone. The strategies our company may adopt could be the same, opposite, or unrelated to the strategies readers might speculate based on this article.


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