The Open Network (TON) has emerged as one of the most successful breakthroughs in 2024. This first-layer platform rose from relative obscurity in just over a year, securing a central position in the cryptocurrency industry's collective consciousness.
TON's rapid ascent owes much to its relationship with Telegram. Unlike other major social media platforms, Telegram actively embraces web3 integration, selecting TON as its preferred blockchain platform for these features. This partnership has significantly benefited TON, with several gaming applications on the platform attracting millions of users at unprecedented speeds.
Telegram's massive distribution capabilities place TON in a unique position among blockchain platforms regarding adoption. So far, we've only seen glimpses of this potential, with activities primarily focused on "tap-to-earn" games that generate explosive early interest but struggle to maintain long-term engagement. As the platform matures, we're excited to see this potential fully realized—particularly whether TON's distribution advantages can help DeFi expand beyond crypto enthusiasts to mainstream users.
The Origin and Rise of TON
The TON project launched in 2017 as Telegram Open Network. Conceived during the ICO boom, it aimed to fund Telegram through a token sale while adding native payments and web3 services to complement Telegram's messaging features—mirroring WeChat's super-app model by integrating social and financial services.
TON quickly became one of the most anticipated blockchain projects, raising $1.7 billion in its 2018 token presale. However, development halted in 2019 when the SEC sued Telegram over its unregistered securities offering. In 2020, Telegram settled with the SEC for $18.5 million and discontinued TON development, transferring the project to the open-source community.
Despite this setback, development continued through open-source initiatives. The NewTON project emerged as a leader, inheriting Telegram's official domain and GitHub repository in 2021. After renaming itself the TON Foundation, the team launched the TON mainnet in May 2021. By year-end, Toncoin—TON's native currency—was listed on major exchanges, paving the way for broader adoption.
Telegram rekindled its public relationship with TON in 2022, introducing username auctions on the TON blockchain. In 2023, Telegram announced exclusive reliance on TON for its web3 features, integrating TON's wallet directly into its app. By March 2024, Telegram enabled channel owners to earn ad revenue in Toncoin, accelerating TON's adoption.
TON's integration with Telegram quickly bore fruit, driving crypto application usage. Notcoin, a tap-to-earn game launched in January 2024, reached 35 million users by March. Similarly, Hamster Kombat claimed 300 million players by July—numbers rivaling top web2 games like Fortnite.
Hamster Kombat's user base highlights Telegram's distribution power. TON's seamless integration brings cryptocurrency directly to Telegram's 950 million users, making it one of the most actively used blockchains. Monthly active addresses surged from ~100,000 in September 2023 to 9.9 million by September 2024—surpassing Ethereum's 5.5 million in the same period.
TON surpasses Ethereum and leading L2s in active addresses
Source: Artemis, GSR
Note: While active addresses can be inflated by bots, they remain a useful reference metric.
Mini-Apps, UX, and Viral Growth
The success of TON applications like Notcoin and Hamster Kombat stems from Telegram's user base and its mini-app functionality. Mini-apps allow users to access interactive web applications directly within Telegram—without separate downloads—using bots or links.
These apps leverage Telegram's native features, including social graphs for viral sharing and integrated payments (including TON). Combined with Telegram's built-in TON wallet, mini-apps provide a seamless crypto UX. Users avoid complex wallet setups or private key imports, engaging with crypto elements only when necessary.
Games like Notcoin and Hamster Kombat capitalize on these features brilliantly. Their simple mechanics—tapping screens to earn points—combined with social sharing incentives and token airdrops, fueled viral growth. By late 2024, this formula helped TON establish a user onboarding mechanism unmatched in crypto.
Mini-apps enable fully programmable web experiences within Telegram
Source: Telegram Docs, GSR
DeFi Opportunities on TON
While most TON activity focuses on gaming/social apps, we see immense potential for DeFi—particularly in expanding beyond crypto-native audiences.
Decentralized finance stagnated after 2021's bull run. DeFi-related tokens fell 72% from January 2022 to September 2024, underperforming memecoins (-35%) and smart contract platforms (-48%). User growth plateaued too: DEXs peaked at ~22 million monthly addresses in September 2024—likely overcounting actual users given bot activity and multi-address usage.
Monthly active users across DEXs barely exceed 20M
Source: Dune Analytics, @rchen8, GSR
DeFi's adoption hurdles include poor UX, complex onboarding, and weak distribution. Telegram + TON solves these by enabling:
- Frictionless access: No separate wallet downloads or asset purchases required.
- Built-in distribution: Direct access to 950M Telegram users.
- Viral mechanics: Incentivized sharing mimics successful tap-to-earn models.
TON-based DeFi can leverage Telegram's reach to bootstrap network effects—critical for payments, lending, and trading protocols where liquidity drives utility. Stablecoin payments present a prime opportunity, especially in emerging markets where Telegram dominates.
👉 Explore how TON's DeFi ecosystem compares to Ethereum's
Key Challenges
TON must address several challenges to fulfill its DeFi potential:
- Developer adoption: TON's custom FunC language and TVM require dedicated developer education. EVM-compatible layer-2 solutions (like TAC) could help attract Ethereum builders.
- Scalability: TON's sharding-based approach faces technical complexities. Network outages under high traffic (August 2024) highlight ongoing scaling needs.
- Smart contract security: DeFi requires robust auditing tools for TVM and FunC—currently less mature than Ethereum's ecosystem.
- Bot/Sybil resistance: Tap-to-earn airdrops show bot activity signs. Telegram integration (e.g., phone verification) may help filter real users.
- Platform risk: Developers need assurance that Telegram won't restrict third-party apps long-term. TON's revenue share (~40% of Telegram's 2023 income) incentivizes ecosystem support.
Overcoming these hurdles could position TON as the chain that brings DeFi mainstream.
FAQ
Q: How does TON compare to Ethereum for DeFi?
A: TON offers superior distribution via Telegram but lags in developer tools and DeFi maturity. EVM compatibility initiatives may narrow this gap.
Q: What makes Telegram mini-apps ideal for DeFi onboarding?
A: Integrated wallets and familiar UX eliminate crypto's complexity. Users engage with DeFi features only when ready—lowering entry barriers.
Q: Can TON's DeFi ecosystem rival Ethereum's TVL?
A: Not yet. But Telegram's user base provides unparalleled growth potential if liquidity incentives align with viral mechanics.