The Open Network (TON) has recently demonstrated remarkable resilience in the cryptocurrency market, steadily climbing in value despite broader volatility. As its market capitalization approaches the top ten, many are beginning to ask: What exactly is TON, and what sets it apart from other blockchain networks?
Originally conceived by the founders of Telegram, TON aims to support massive-scale applications with high transaction throughput and low latency. Its unique technical architecture and close affiliation with one of the world’s most popular messaging platforms make it a project worth understanding.
What Is The Open Network (TON)?
TON is a high-performance Layer 1 blockchain designed to handle millions of transactions per second. It uses a multi-blockchain structure consisting of a masterchain and multiple workchains, each of which can be subdivided into up to 2⁶⁰ shardchains. This hierarchical sharding mechanism allows the network to scale almost infinitely while maintaining near-instant cross-shard communication.
Unlike Ethereum Virtual Machine (EVM) compatible chains, TON uses its own TON Virtual Machine (TVM) and a native smart contract language called FunC. The network relies on a Byzantine Fault Tolerant (BFT) proof-of-stake consensus mechanism referred to as Block Proof of Stake (BPoS), where validators stake TON to participate in block validation.
The History and Evolution of TON
TON’s origins trace back to 2018, when Telegram founders Pavel and Nikolai Durov began developing a blockchain capable of supporting their app’s enormous user base. The project, then named Telegram Open Network, raised $1.7 billion through private token sales.
However, in October 2019, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Telegram, alleging an unregistered securities offering. After a prolonged legal battle, Telegram settled with the SEC in May 2020, agreeing to return investor funds and discontinue direct involvement in TON.
Following Telegram’s exit, an independent community of developers named NewTON took over development based on the original TON whitepaper. By May 2021, the testnet had stabilized sufficiently to transition to mainnet, and the team rebranded as the TON Foundation.
In April 2022, the TON Foundation launched the TONcoin Fund—a $250 million ecosystem fund supported by exchanges like Huobi and KuCoin—and raised an additional $527 million from community donations.
How TON Works: Core Innovations
TON introduces several novel concepts that differentiate it from other blockchains, particularly in resource payment and asynchronous execution.
Resource Payment Model
In TON, smart contracts pay for their own computation, storage, and bandwidth using TON tokens held in their balances. This is a significant departure from the user-pays model used in Ethereum. If a contract runs out of tokens, it is automatically deleted—a feature that helps prevent blockchain bloat.
Asynchronous Architecture
Smart contract calls in TON are processed asynchronously rather than atomically. This means that a call between two contracts does not execute immediately but is scheduled for a future block. While this supports greater scalability, it also introduces complexity in maintaining consistency across transactions—a challenge familiar to developers on other async chains like Internet Computer (ICP).
TON's Tokenomics and Distribution
TON began with a total supply of 5 billion tokens. Of these, 98.55% were distributed through Proof-of-Work (PoW) mining between 2020 and 2022. The remaining 1.45% was allocated to the development team.
In February 2023, the TON community passed a proposal to temporarily freeze 171 inactive mining wallets holding approximately 1.081 billion TON (about 21% of the total supply) for 48 months. This measure aimed to reduce potential selling pressure.
Today, the network operates on Proof-of-Stake (PoS), with an annual inflation rate of 0.6% used to reward validators. The current circulating supply is around 3.53 billion TON, with nearly 480 million staked by validators.
However, TON’s distribution remains highly concentrated. The top 100 addresses hold more than 50% of the supply—a concerning level of centralization compared to Bitcoin, where the top 100 addresses hold just 13.63%.
To counter inflation and reduce supply, the community also approved a proposal to burn 50% of transaction fees. Still, with only 350–400 TON burned daily, the impact remains limited relative to the total supply.
The Telegram-TON Relationship
Although Telegram officially parted ways with TON in 2020, the two remain closely linked. Telegram’s CEO has publicly expressed support for TON, and the messaging app has integrated TON-based features such as the @wallet bot, which allows users to send, receive, and spend TON directly within Telegram.
This integration offers a seamless onboarding experience for Telegram’s 800 million+ users, allowing them to:
- Send and receive TON in chats
- Buy Telegram Premium subscriptions
- Purchase virtual eSIM cards via @Mobile
- Trade usernames via Fragment
These use cases position TON as a practical utility token rather than merely a speculative asset.
Current Ecosystem and Major Projects
TON’s ecosystem is still in its early stages, with a total value locked (TVL) of around $10 million. Most activity is concentrated in a few foundational projects:
🚀 Fanzee
A Web3 sports and fan engagement platform that introduced the first staking mechanism for Jettons (TON’s equivalent of ERC-20 tokens).
💧 Megaton Finance
A decentralized exchange developed by OZYS, which currently dominates TON’s DeFi landscape with a TVL of ~$7.3 million.
🧳 Wagmi11
A prediction market platform where users can bet on crypto, sports, and geopolitical events using TON.
🎟️ A6g.events
A ticketing protocol built on TON for secure, transparent ticket sales and validation.
📋 Questbook
A grants management tool integrated with Telegram, supporting notifications, TON wallet payments, and multisig functionality.
For those interested in diving deeper into the ecosystem, you can explore more TON-based applications.
Challenges and Opportunities
TON’s greatest strength—its integration with Telegram—is also a source of challenge. The concentration of tokens among early miners poses a systemic risk. If large holders decide to sell, it could destabilize the economy and undermine validator incentives.
The async architecture also complicates DeFi development, as seen in other ecosystems like ICP. However, this design is intentional—prioritizing scalability and mass adoption over composability.
TON is not trying to be another Ethereum. It aims to become a decentralized platform for everyday applications: a Web2.5 bridge that introduces traditional users to blockchain with minimal friction.
Frequently Asked Questions
What makes TON different from other blockchains?
TON uses a unique sharding architecture, asynchronous smart contracts, and a resource payment model where contracts—not users—pay for gas. It is also closely integrated with Telegram, giving it access to a massive user base.
Is TON a good investment?
TON shows promise due to its technical foundations and Telegram partnership. However, its highly concentrated token distribution and early-stage ecosystem pose risks. Always do your own research and consider market conditions.
Can I stake TON?
Yes. TON uses a proof-of-stake consensus. You can stake directly as a validator or delegate your tokens to a validator using a nominator pool.
What is the relation between Telegram and TON?
Though legally separate, Telegram supports TON through integrated features like @wallet and has endorsed the project publicly. The TON Foundation continues to develop the blockchain independently.
How can I use TON?
You can use TON for payments, staking, trading usernames, buying virtual products, and interacting with dApps within the TON ecosystem.
Is TON decentralized?
While technically decentralized, TON’s token distribution is highly concentrated. The community has taken steps to reduce supply centralization, but this remains a work in progress.
Conclusion
The Open Network represents an ambitious vision: combining high-performance blockchain technology with mainstream usability through Telegram. While its tokenomics and architectural complexity present challenges, its potential for mass adoption is significant.
The future of TON will likely depend on its ability to decentralize token ownership, grow its ecosystem, and continue leveraging Telegram’s distribution. Whether it becomes a true leader in the space remains to be seen, but it is undoubtedly one of the most interesting projects in crypto today.
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