The Open Network (TON)

TON is a sharded smart contract blockchain network.

Basics

• Started in:
• Based in: Russia
• TON launched in 2018
• Fka Telegram Open Network, since then usually just called TON.
• Telegram was planned to launch their own blockchain in 3-2019 but got closed down (12-5-2020) as an official Telegram project. However, the TON blockchain itself kept running and is still used by Telegram (1-12-2022).

History and Forks

• Changed its token name into Toncoin (TON).
• From Decrypt (29-5-2020)

"The Chinese community group for the Telegram Open Network today announced that it is launching its own version of the blockchain. The Chinese project to launch TON is one among several trying to keep Telegram’s magic alive. There’s Free TON and NewTON, both of which want to get the Telegram Open Network online, using open source-code published by Telegram."

• From Cointelegraph (6-5-2020):

"Telegram recently delayed their open network, TON, and their cryptocurrency, GRAM, once again. There is one related project that has not experienced these setbacks, however. TON OS, an operating system for the TON blockchain, will soon get an open source release.

The project’s core infrastructure developers, TON Labs, are planning to open source the main components of the TON OS on GitHub tomorrow. Mitja Goroshevsky, CTO at TON Labs, confirmed the news to Cointelegraph on May 6."

TON Labs to issue a token known as TON Cash within a month

As reported by industry publication, ForkLog, the release includes TON Node in the Rust programming language, command line interface, TON Multi signature Wallet smart contract, as well as tools for launching TON validators. The report notes that within a month, TON Labs also plans to issue its decentralized browser, Surf, its staking pool, DePool, and the token known as TON Cash.

In conjunction with the TON OS open source release, TON Labs is joining the Free Software Foundation (FSF), a major free software movement. As such, all the components of the TON OS are being launched as a free software. According to the developers, the idea of a permissionless blockchain in a closed source is absurd. TON Labs reportedly felt that joining the FSF will help them maintain free use of the application as well as the TON blockchain."

Audits & Exploits

• Bug bounty program can be found [insert here].

Token

Token Allocation

• From their website (14-12-2022):

"New Toncoins are generated during validation. These also go to validators. Overall annual coin inflation is about 0.6%."

"The blockchain runs on proof-of-stake technology, making it fast and cheap, but the initial token distribution was enabled by mining, which was decentralized and had the same conditions for all who participated."

Utility

• From Poloniex (3-12-2022):

"$TON is used for transaction processing fees as well as cross-chain transaction fees. dApps that build on TON can also receive the token in exchange for services their app provides. $TON is also the governance token of the network, and is used to vote for decisions that affect the future of the network."

Coin Distribution

• The TON Foundation has 2 wallets with in total around ~570M tokens, at the moment there are around 5B tokens, so this would be ~11.3% of the supply. These wallets also seem quite active, with 9 tx in the last 4 days. There is also a list of early miners. The highest address has a bit above 2% of the supply. Keep in mind that TON has 0.6% inflation per year, so this will dilute.

TON Technology

• Whitepaper or docs can be found here (26-7-2021). Had a first version in 2017.
• Code can be viewed here.
• Consensus mechanism: PoS
• Algorithm:
• Virtual Machine: Turing complete
• Development language used:

Transaction Details

• Capacity (TPS): 1million tps (3-12-2022).
• Latency: under 6 seconds (3-12-2022).

How it works

• From their website (14-12-2022):

"An ad hoc Byzantine Fault Tolerant Catchain protocol was developed to ensure that stakeholders achieve consensus as long as the number of cheaters among them is 1/3 or less."

• From Poloniex (3-12-2022):

"Its purpose is to provide a platform for decentralized applications (dApps) and smart contracts. It is based on a multi-blockchain architecture and consists of a master chain, several working blockchains, and sharding protocols.

Some of TON’s Components:

1. The TON P2P (peer-to-peer) Network which is for accessing the TON Blockchain, sending transactions candidates, and giving blockchain updates to a client
2. Distributed storage, or TON Storage, which archives copies of blocks and snapshots.
3. TON Proxy, which users can anonymously access and use the network through.
4. A distributed hash table.
5. A platform for services that feature UI that is browser/app-like for easy use through a smartphone.
6. TON DNS, which, like DNS for the Internet, assigns human-readable names to smart contracts, accounts, services, network nodes, and smart contracts.
7. A platform for micropayments called TON Payments

So about that “1million tps”. That sounds crazy, right? Well, this is made possible due to TON’s unique architecture. The TON blockchain is made up of a “collection of two blockchains”. That is, a master blockchain (or masterchain) and several working blockchains (or workchains). The master blockchains are responsible for being a repository of the protocol’s general information, information about validators, workchains and their shards, and the hashes of the work- and sharchains’ most recent blocks. The workchains, on the other hand, contain information on events like smart contract transactions and value-transfer. In terms of consensus, the blockchain uses a proof of stake mechanism.

What is interesting about the workchains is that they themselves can be split up into shard blockchains (or shardchains). Each shardchain is tasked with handling transactions for a subset of accounts. The network has an impressive block time of 5 seconds, and can split workchains into 260 shards, allowing for much less network stress and congestion."

Staking

• From their website (14-12-2022):

"Validators stake Toncoin for a fixed specific term, and the stake is refunded with interest after the completion of a validation round. Should a validator attempt to cheat or be unavailable during a validation round, its stake is partially or fully forfeited as a penalty. The TON Nominator service allows Toncoin holders to lend their asset to owners of validator nodes (validators). Toncoin earned by the validator is distributed to those that lent their assets to the validator."

Validator Stats

• From their website (14-12-2022):

" Currently, the average validator stake is 600k Toncoin. ~270 Toncoin / per day. Average income daily generated by validator node with average stake as of May 2022."

According to TONwhales the minimum for staking is at least 350,000 TON.

Mining

• There seems to still be a mining pool active as well, besides PoS. "InfinityTON pool is the only pool where you can continue to mine TON." However, according to the official ton.org website, mining has ended:

"In June 2020, all of the available Toncoin tokens (98.55% of the total supply) became available for mining. The tokens were placed in special Giver smart contracts, allowing anyone to participate in the mining — up until 28 june 2022. Users mined around 200,000 TON daily. Today, two years later, the last Toncoin was mined, signaling the successful closure of TON’s initial distribution."

Scaling

• From their website (14-12-2022):

"The system can potentially accommodate up to 2³² workchains, each of which can be subdivided into up to 2⁶⁰ shardchains with near-instant cross-shard and cross-chain communication, resulting in millions of transactions per second."

Projects

• From Decrypt (1-12-2022):

"Pavel Durov—the messaging platform’s founder and CEO—announced that the company would begin building “non-custodial wallets” and “decentralized exchanges” that would let millions of users safely trade their crypto. The executive argued that the project should be more than feasible: the development of Fragment, Telegram’s decentralized auction platform, “took only 5 weeks and 5 people, including myself,” according to Durov. The marketplace, which launched last month, has already raked in $50 million worth of Toncoin by selling tokenized usernames on the blockchain."

Usage

Projects that use or built on it

• Ston.fi; AMM, with around ~600k TVL (14-12-2022). Has 7 coins to swap.

Competition

• A comparison (21-4-2020) with Status and Signal was done by Status.

Team, investors, Partners

Team

• TON Labs; The project’s core infrastructure developers
• After the first failure, the TON Foundation took over.

Investors

• Part of (9-3-2020) the portfolio of Arrington XRP Capital.
• Raised $90M for a new ecosystem fund continuing its recent attempts to get the Telegram-founded blockchain project back into gear (7-7-2022).