TON Blockchain: The Origins and Technical Characteristics of Telegram's Crypto Network

In this article, we retrace the origins of Telegram’s crypto network, up to what we know today as the TON blockchain.

In 2017, Telegram began exploring blockchain solutions to support its massive user traffic, estimated in billions. After a year of research, the company launched its own blockchain, known as “Telegram Open Network” (TON), along with the GRAM token (later renamed TON).

The token sale, conducted through an Initial Coin Offering (ICO), aimed to raise venture capital for Telegram to enhance its servers and services dedicated to the crypto sector. Over 80% of the funds were earmarked for equipment, bandwidth, collocation, and user verification costs.

However, two years later, the Durov brothers were forced to exit the project following an injunction from the Securities and Exchange Commission (SEC). The US regulator had classified the brothers' activity as an unregistered “security” public offering.

As a result, Telegram was fined $18.5 million, and the project was largely abandoned to make way for other endeavors. The brothers were also required to return the ICO proceeds to investors, totaling about $1.7 billion.

Despite Telegram's initial project being abandoned by the founders themselves, and the new crypto GRAM being forgotten, from 2018 to 2020 the social media company had made great strides in designing the blockchain network The Open Network, also achieving important milestones.

Until the arrival of the sanction from the SEC, the product had been improved several times. The development team had released a lite version of the blockchain network client, published a complete source code for nodes on Github and launched a testnet.

Since the crypto network was practically ready to debut on the market, the founders of Telegram thought it wise to decentralize the project.

All the codes have been distributed in an open source manner to the developers, just as Tesla did with the liberalization of patents for electric cars a few years earlier.

From there was born what we all know as the TON blockchain, even though it has kept the name Telegram Open Network.

GRAM was renamed TON (Toncoin), with the only difference being that the token was no longer controlled by the company itself, but had become a free resource.

This transition has led to a radical shift. From a centralized initiative tied to a corporate entity to a decentralized project managed by the community.

This change has allowed Telegram to evolve independently, continuing to expand and innovate in the world of cryptocurrencies

As of today, the crypto network is known for its extraordinary transaction processing capability.

With the launch of Telegram’s crypto network in 2020, several very interesting technical implementations were inaugurated.

Its architecture features several cutting-edge characteristics, such as the use of a dynamic sharding mechanism.

This feature allows the blockchain to manage transaction processing load more efficiently, resulting in a high-performance scalability.

Furthermore, the developers of the Telegram community have implemented an instant routing mechanism that ensures rapid propagation through the network.

This means minimizing latency and improving the end user’s experience.

It should also be noted the presence in Ton of a particular Byzantine Fault Tolerant consensus mechanism called “Catchain Consensus”.

This model ensures reliability in achieving distributed consensus, contributing to ethical behavior on the part of the node structure.

Very important to also mention the presence in this sense of Proof of Stake which allows maintaining the integrity of the network in the crypto world.

Just like on Ethereum, the Ton blockchain also features its own virtual machine, called the TON Virtual Machine (TVM). It is responsible for executing smart contracts and provides an operational framework for the development of dapps.

One of the most interesting aspects is, however, its perfect integration with the messaging app Telegram. 

The network has indeed been designed to be complementary to the structure of the social media, being able to adapt to its high performance.

The crypto TON plays a fundamental role in this field: it represents the gas token of the chain as well as the currency used for payments.

Users can send and receive Toncoin directly within the Telegram app, through a very simple and intuitive process.

The same resource is used to reassure the network through staking, as well as to tip content creators and developers. Payments can also be made via bot, thanks to features like Telegram Stars.

Although the Telegram crypto network was officially launched in 2020, it is only from 2024 that it has reached true mainstream adoption.

After some marketing stunts, the Foundation managed to bring a good user base to the network, becoming the 20th chain by total value locked (TVL).

For example, in February 2024, Telegram decided to share 50% of its advertising profits with channel owners through payments in TON.

This has allowed the crypto TON to be elevated, bringing it to the attention of the general public, given its new utility.

In March then, the team announced the allocation of 30 million TON in rewards to the community, for a value of 115 million dollars.

Furthermore, in April the stablecoin USDT