After Token 2049, more and more institutions and entrepreneurs began to pay attention to the TON ecosystem. The TON ecosystem has great potential, but at the same time, it is quite unfamiliar to many people, like seeing flowers in the fog, confusing and elusive. We understand the potential risks of betting on a new ecosystem like TON, so as early builders of the TON ecosystem, we hope this article and our thinking can help everyone better understand TON.
If you are interested in TON, you can come to TonUP Community and discuss the future of TON with us. We warmly welcome more entrepreneurs and institutions to join this ecosystem.
A Public Chain Born for Large-Scale Applications
TON was initially developed by Telegram and is currently maintained by the TON Foundation and the TON Core Team as a Layer 1 public chain. TON is technically designed as a high-performance sharding chain, introducing compound sharding technology to achieve high scalability, allowing the network to grow with the increase in the number of users and transaction volume, better meeting user needs.
On October 31, 2023, TON officially launched the Guinness World Record challenge, and TON successfully ran out 104,655 TPS (Transactions Per Second) in 512 shards, becoming the fastest public chain currently tested, far surpassing Solana and BNB Chain. Telegram’s founder Dr. Durov specifically introduced this challenge on his channel.
In fact, TON is a project from 2018, contemporaneous with Ethereum. It can greatly surpass Ethereum and even the new generation of public chains in performance. The core reason is that the team members of the TON Core Team mostly come from Telegram and VK, with rich experience in developing high-concurrency platforms.
High concurrency and higher performance are just the basics of TON. In this article, we will not delve into the technical details of TON, but focus more on the imagined space of TON and Telegram. If you are interested in the technical details of TON, you can refer to TON’s white paper.
Why are we bullish on TON?
We are bullish on TON for two simple business reasons:
- TON is part of Telegram’s commercialization, it will deeply integrate with Telegram and complete the unfinished road of innovation by Facebook Libra;
- Based on such an innovative platform, a flourishing and prosperous ecosystem will develop on TON, which will in turn empower Telegram, forming a strong flywheel (we will explain this in detail later in the TON + Telegram > WeChat section).
Our earliest contact with TON began in the spring of 2023, when TON had not yet formally cooperated with Telegram, and we happened to make contact with the TON Foundation by chance. After careful due diligence, we concluded that TON is part of Telegram’s commercialization.
Our thinking is very simple, there seem to be only two ways for social networks to commercialize at present: become an advertising company or a financial platform. Obviously, becoming an advertising company does not meet Dr. Durov’s original intention, nor does it meet Telegram’s strategic goals. And the gene of Telegram determines that Telegram cannot obtain a financial license in the Web 2 world like WeChat does.
Web 3 is the most suitable path for Telegram’s development. A financial platform built on a social network that empowers more than 800 million monthly active users is an exciting story for us. We have experienced 10 years of the mobile internet wave in the Greater China region and Southeast Asia, and we deeply know the huge business opportunities therein.
Tencent’s highest market value once touched $949 billion, and the market value of the Japanese social software LINE also exceeded $20 billion. In contrast, at that time, TON’s FDV didn’t even reach $1 billion. Therefore, we believe that as a financial platform for large-scale applications in the future Web 3, TON is seriously undervalued.
The above may be what everyone already knows. Next, I would like to share some thoughts as an entrepreneur who has experienced the mobile internet wave in the Greater China region.
Telegram + TON > WeChat
In 2011, Tencent officially launched WeChat, which now has over 1 billion monthly active users worldwide1 . The growth of WeChat is actually accompanied by the mobile internet boom led by iPhone and Chinese mobile phone manufacturers, making Tencent the biggest beneficiary of China’s rise in the mobile internet over the past decade.
WeChat is a Super App that Elon Musk envies. We can use WeChat to call a car, order food, buy movie tickets, shop online, watch live streams, recharge games and mobile phones, order takeaway, etc. It can be said that WeChat has become a daily necessity for most people in mainland China, and thanks to WeChat, many people can go out just with a phone.
But if we break it down, WeChat is actually composed of two parts: WeChat social and WeChat payment, representing social and financial modules, respectively, which are analogous to Telegram and TON. Relying on social + finance, WeChat was able to build a rich set of scenarios and ecosystems, including small payments, e-commerce (JD.com, Pinduoduo, Weidian), life services (service numbers), financial services (WeChat Fortune), game distribution (especially social games), content communities, and so on;
The combination of social and financial has inherent advantages. According to data from the China Payments and Clearing Association in 2020, the proportion of users using WeChat Pay increased from 87.3% in 2019 to 92.7%2. Imagine, if 10% of Telegram users used TON wallets, there would be 80 million users using TON.
What’s more important is that we believe that the potential of Telegram + TON will far exceed WeChat. We have to admit that in the current geopolitical and ideological conflicts, WeChat still faces huge challenges in going global. In other words, the WeChat ecosystem we will discuss is still largely limited to mainland China and Mandarin-speaking areas.
And this is exactly the space for TON. The Open Network (TON) is a permissionless public chain, not a product of a certain entity under the regulation of a certain country. It can be used by anyone in any country or region to deploy their own app. This means that an American tourist in Bali can use TON or a stable coin on TON to pay for his diving fee through Telegram, which is something WeChat can’t do.
It also means that TON can become a banking service system in many countries without basic banking services, such as some African countries, because any phone that can run Telegram can use TONSpace (a non-custodial wallet embedded in Telegram). We always believe that there will be many “invisible champions” in the TON ecosystem. These champions may achieve great success in some specific fields in certain countries, and we may not have even heard of them.
Crypto is small now, but Web 3 and TON are big. We suggest everyone to take a new perspective to look at TON, we are discussing a great business revolution.
Where are the opportunities of TON
Finally, let me introduce ourselves. Microcosm Labs is a startup company focusing on the TON ecosystem. We will participate in the investment, R&D, operation, and incubation of TON ecosystem projects. We named our company Microcosm Labs because we firmly believe that every small innovation has the potential to change the world.
Our first incubated project, TonUP, has become a core launchpad in the TON ecosystem, and has received strong support from the TON Foundation and Foresight X. From our viewpoint, there are at least three clear tracks on TON:
- Gaming and GameFi track, especially casual or hyper causal games based on social relationships, a proven opportunity in the Web 2 era, referring to Facebook Game and WeChat mini-games;
- Deeply integrated applications with Telegram, such as stranger social, local life, etc.; TON can be used as a clearing or value carrier for such applications, and we believe that many innovative products will emerge in this part;
- All upper-layer applications require the support of financial primitives, so we believe that transactions (DEX), lending (Lending), payment (Payment) and other financial primitives will still have huge opportunities.
We are delighted to join the TON ecosystem in its early days and receive everyone’s support. We also sincerely hope that more entrepreneurs and investors can join us. We know many problems of this ecosystem, but only build will make this ecosystem better.
We always believe that every small innovation has the potential to change the world.
1: 2022 Annual Ranking of Monthly Active Users of Chinese Communication and Social Apps TOP10, iMedia Consultancy
2: 2020 Mobile Payment User Report: WeChat Pay Surpasses Alipay, Becomes the Most Frequently Used Product by Users (2020年移动支付用户报告：微信支付超越支付宝，登顶用户最常使用产品_手机新浪网)
About Microcosm Labs
Microcosm Labs is the innovation hub and venture building lab dedicated to TON’s ecosystem. We have incubated TonUP, the core launchpad on TON backed by TON Foundation and Foresight X. We always believe that every small innovation has the potential to change the world.