Telegram’s Message to the Market
The major blockchain ecosystem project by messaging giant Telegram, called Telegram Open Network (TON), had its test version done at 70% in September, according to a Telegram investor update that recently surfaced. The project supposedly might launch in the next few months and represent another foundation where new projects may build upon.
According to the document, initially spotted by The Block, in September, many parts of the project were more than 90% finished, including the Virtual Machine itself (95% done), and the TON Network (around 95% done). The TON Blockchain Block Generation and Validation is what needs the most work, as some parts of it were 10% to 30% done. Smart contracts and developer resources like sample smart contracts were also just barely begun.
Telegram did not respond to a request for comment.
The Virtual Machine could well be the most interesting part of the project to most. Similar to the Ethereum Virtual Machine, it is designed to launch and execute smart contracts and decentralized applications (dapps), as well as deploying tokens. The TON Network is the environment in which requests will be delivered via transactions and propagated blocks. The Block Generation and Validation part is what is currently in active development, as it couldn’t be done earlier due to the fact that it needed the previous two components in working order.
Back in Q1 of this year, Telegram raised a total of USD 1.7 billion in its private token sale, and their investors should be getting their tokens as early as December, although the company does not expect to be listed on a major exchange until 2019. For the TON project, this means a significantly higher starting point than for most: not only in terms of funds, but also of user base, as Telegram boasts 200 million monthly active users as of March 2018.
There are also several controversies surrounding TON. The first is the fact that this project claims to solve one of blockchain’s most challenging issue of scalability by developing an entirely new blockchain that will be able to process millions of transaction per second, citing the use of terms such as “infinite sharding” and “hypercube routing.” These topics, however, have often been dropped by other researchers due to their complexity.
The second issue stems from the fact that in Great Britain, a fraudulent company named Telegram Open Network was established, which led to problems during the token sale for the TON project. At the time, the goal of that company was to rip off investors using the name Telegram for credibility. Luckily for the legitimate project, the fraudsters were exposed in time – but they could have done much more damage given the fact that they were a legally registered company at the time. This has made a part of the community skeptical towards the real project, refusing to even consider the alternative.
The percentage of completion – 70% – only means that the team is not too far away from a test version of the network. It must be noted that to date, there have been neither announcements nor estimates regarding the timeline for a fully working product, and the official roadmap states the date only as “to be announced.” However, even a test version is believed to offer a good indication of the issues blockchain ecosystems face, especially in the case of scalability. Should TON be able to implement the solutions they intend to, the community believes this could open up the path for many other improvements as well.
Some interest also comes from the fact that Telegram is backed by big players – some anonymous, others not so much, like Russian billionaire Roman Abramovich. However, the original team has run into their own share of problems as well: in April this year, a Moscow court ordered telecommunications companies to block the Telegram chat app in Russia due to their refusal to give authorities access to their users’ encrypted messages and private data.
