Telegram, initially launched in 2013 as a straightforward messaging application, has evolved into a significant force within the cryptocurrency landscape, particularly through its integration with the TON blockchain. Founded by brothers Nikolai and Pavel Durov, the platform quickly garnered attention for its commitment to privacy and speed, establishing a solid user base that has only grown over the years.
Telegram origins and shift to crypto
From its inception, Telegram distinguished itself with features such as encrypted chats and the ability to host large group conversations. The introduction of bots in 2015 marked a pivotal moment, allowing users to automate tasks and manage interactions more efficiently. As the platform continued to expand, voice calls were added in 2017, followed by video calls in 2020, enhancing its communication capabilities.
Telegram further innovated with the launch of channels, enabling users to broadcast messages to vast audiences. This feature was later complemented by stories for channels, allowing ephemeral content sharing with advanced privacy settings. The platform also introduced a transparent giveaway system, offering users the chance to win tangible prizes.
However, the Durov brothers envisioned a more ambitious future for Telegram, aiming to transform it into a decentralized platform that revolutionized digital transactions and communications. This vision materialized in the form of the Telegram Open Network (TON) blockchain, designed to facilitate millions of transactions per second while seamlessly integrating with the messaging service.
Developing the TON blockchain
The journey of the TON Blockchain began in earnest with the release of a whitepaper by Pavel Durov in 2018, outlining its technological innovations and potential. Initially intended to incorporate cryptocurrency and blockchain features into the Telegram ecosystem, TON was crafted with scalability as a core principle. Its unique multi-blockchain architecture and sharding mechanism aimed to support an impressive volume of transactions.
To fund this ambitious project, Telegram sought to raise capital through an initial coin offering (ICO), successfully securing approximately .7 billion from 175 investors during a private sale of its native Gram token. However, this success was short-lived as the U.S. Securities and Exchange Commission (SEC) soon intervened.
Legal battle with the SEC
In October 2019, the SEC filed a complaint against Telegram, alleging that the company had conducted an unregistered securities offering by selling Gram tokens. The SEC contended that these tokens qualified as securities and should have been registered under U.S. laws. The legal battle culminated in a decisive ruling in March 2020, where a U.S. federal court sided with the SEC, halting the distribution of Gram tokens.
This ruling led Telegram to postpone and ultimately abandon the project in May 2020, agreeing to refund the funds raised during the pre-ICO and pay an .5 million civil penalty. The repercussions of this decision resonated throughout the crypto industry, underscoring the regulatory hurdles faced by blockchain initiatives.
In the wake of Telegram’s withdrawal, independent developers continued to advance the TON project, which was subsequently rebranded as The Open Network. A non-profit organization, the TON Foundation, now oversees its development, with Steve Yun as president and Andrew Rogozov, a former CEO of VK, as a founding member. The community focused on enhancing the network’s architecture and refining its proof-of-stake consensus mechanism throughout 2021 and 2022.
Telegram’s continued support and integration
Despite stepping back from direct development, Telegram has maintained its support for the TON platform. In September 2023, the messaging app, boasting over 800 million users, integrated the TON Space self-custodial wallet. This was followed by the introduction of an ad revenue-sharing system, where payments are exclusively made in Toncoin (TON), the successor to Gram, further engaging users with the TON ecosystem.
Telegram’s official endorsement of TON in September 2023, designating it as the app’s “official web3 infrastructure,” has sparked renewed investor interest, leading to significant gains for the TON token. As a result, the total value locked on TON surpassed 0 million by May 27, 2024, a milestone driven by a community rewards initiative from the TON Foundation.
Telegram’s current role in crypto
In the wake of its regulatory challenges, Telegram has emerged as a central hub for the crypto community, facilitating discussions, collaborations, and information sharing. The platform’s groups and channels are widely utilized for announcements, trading signals, and community engagement within the crypto ecosystem.
Telegram’s influence has been further solidified by the introduction of features tailored to crypto users, including a digital marketplace and integrations with popular wallets like Trust Wallet. This collaboration allows Trust Wallet’s 100 million users to send and receive TON tokens, enhancing the platform’s utility.
Moreover, TON’s upcoming support for Tether (USDT) tokens will enable Telegram users to send this stablecoin directly within the app. This development has positively impacted TON’s value, which surged from approximately .21 to .63 in just one year, according to CoinGecko data.
Rise of mini-apps and the tap-to-play ecosystem
On July 31, Telegram announced the rollout of a new in-app browser, further enhancing its blockchain capabilities and user experience. This announcement followed the introduction of a mini app store, allowing users to discover popular mini apps easily. With 500 million of Telegram’s 950 million users engaging with mini-apps monthly, this feature consolidates access to these applications in one location.
The ecosystem also introduced “Stars,” a new in-app payment unit launched on June 7, enabling users to send Stars to friends and utilize them for transactions within mini-apps, which can later be exchanged for Toncoin. Popular mini-apps like Notcoin and Hamster Kombat have attracted millions of users, with Notcoin boasting over 35 million users and a market cap of .15 billion.
Hamster Kombat, a crypto exchange management simulation game, has rapidly gained traction, reportedly amassing over 300 million users since its launch in March 2024. The project plans to execute a significant airdrop for its native token, HMSTR, claiming it will be the largest airdrop in crypto history.
Another mini-app, Catizen, has also seen remarkable success, attracting over 27 million active users. This success has led to investment from HashKey Capital, a Hong Kong-based crypto venture firm. However, delays in the anticipated token airdrops for HMSTR and Catizen’s CATI tokens have caused frustration among users, with both projects citing planning and technical challenges as reasons for the postponements.
Looking ahead
Telegram’s venture into the crypto and digital assets market reflects its ambition to become a comprehensive digital ecosystem. With innovative monetization strategies and the success of its mini-apps, the platform is poised for continued growth in the crypto space. Furthermore, Pavel Durov has hinted at a potential initial public offering (IPO), revealing plans for Telegram’s financial future and aiming for profitability by 2025.
Since 2021, Telegram has successfully raised billion through bond issues, with bondholders potentially receiving a discount on the IPO if it occurs before March 2026. Telegram’s evolution from a messaging app to a significant player in the crypto arena showcases its ability to adapt and innovate, remaining a vital platform for the crypto community.
