TON Rebirth Technological Advancements and Future Prospects of the Telegram Open Network

TON Rebirth Advancements & Future Prospects of the Telegram Open Network

Author: Cynic Shigeru, Translator: CGV FOF

TL;DR

• History of TON: Telegram, founded by the Durov brothers, started developing its own blockchain – Telegram Open Network (TON) in 2018 to meet the needs of its billions of users. Through its $Grams token ICO, TON raised over $1.7 billion. However, in 2019, Telegram abandoned further development of TON due to a lawsuit from the U.S. Securities and Exchange Commission (SEC). However, between 2020 and 2021, the NewTON team restarted TON development based on open source materials and successfully renamed it The Open Network.

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• Technical Features of TON: TON is designed for large user groups. Its unique feature is the use of sharding technology, which allows multiple chains to process transactions in parallel, known as “blockchain of blockchains”. TON’s architecture consists of three layers: masterchain, workchain, and shardchain. The masterchain acts as a coordinating hub, while actual transaction processing is done by various workchains and shardchains. In addition, TON’s sharding is dynamic, allowing for the composition of larger Shardchains based on the interaction between accounts.

• Network Structure of TON: TON nodes use the Abstract Datagram Network Layer (ADNL) for communication, which provides the foundation for interaction between different Shardchains. By utilizing the Kademlia Distributed Hash Table (DHT) to locate other nodes in the network, TON also creates Overlay sub-networks specific to each Shardchain, ensuring efficient communication.

• Applications and Prospects of TON: TON aims to build a decentralized, secure, and reliable internet, not just for funding purposes. For example, features like TON eSIM, TON Domain, and TON Storage are designed to enhance user privacy and data security. Although the current demand for decentralization may not be high, TON has established a large fund for its ecosystem and relies on its massive user base to attract attention and grow in the future.

• Despite facing challenges upon its initial launch, TON continues to attract attention in the blockchain field due to its innovative technology and vision for the future of decentralized networks. Its strong financial support and large user base also lay a solid foundation for its future development.

The Story of TON

In 2018, the founders of Telegram, the Durov brothers, began exploring blockchain solutions for Telegram. At that time, there was no blockchain that could support Telegram’s billions of users, so they decided to design their own Layer 1 chain called Telegram Open Network, or TON for short.

Months later, TON raised over $1.7 billion through an ICO for its native token $Grams. In 2019, the Telegram team released relevant documents and launched two testnets.

In October 2019, the U.S. Securities and Exchange Commission (SEC) sued Telegram, accusing it of conducting an unregistered securities offering. The Telegram team suspended the launch of the TON mainnet and eventually chose to abandon TON’s development and refund the ICO funds to investors in their struggle with the SEC.

Between 2020 and 2021, the NewTON team restarted the development of TON based on open source materials. In May 2021, the community voted to rename the long-term stable Testnet 2 to Mainnet. The NewTON team also renamed itself to the TON Foundation, which supports and develops TON as a nonprofit community.

This is now what we are familiar with: TON, the abbreviation for The Open Network.

Of the Network

From the beginning of the story, TON was built for social networks with a large number of users. TON Blockchain is Telegram’s blockchain. At that time, under the outdated technology system, the TPS of mainstream blockchains could not be effectively improved. How could it support the billions of users on Telegram and the potentially millions of transactions per second?

The idea of the TON team was that the TPS of a single blockchain can only reach a few tens of transactions per second, so why not build multiple chains? TON uses sharding technology to distribute the workload of processing transactions across multiple chains, creating a blockchain network composed of multiple blockchains, known as the blockchain of blockchains.

Specifically, TON Blockchain adopts a three-tier pyramid architecture, with each tier accommodating a type of blockchain: masterchain, workchain, and shardchain.

Masterchain is the central coordinator of TON Blockchain and there is only one chain. It contains the parameters of the protocol, the set of validators, and their shares, the current working workchains, and the subordinate shardchains. The lower-level chains will submit the hash of their latest block to the masterchain, so when the lower-level chains need to read cross-chain messages, they can determine the latest state.

Masterchain plays a coordinating and anchoring role, while the actual work is done by workchains. The system can accommodate up to 2^32 workchains. Each workchain can flexibly customize rules, such as address format, transaction type, native tokens, and smart contract virtual machines, as long as they meet interoperability standards. It is worth noting that workchain is just a virtual concept. It exists as a collection of shardchains and has no physical existence.

To improve processing efficiency, each workchain is further divided into shardchains, with a maximum of 2^60 shardchains. Shardchains follow the rules set by the workchain and distribute the workload across all shardchains. Each shardchain only serves a subset of all account collections.

For typical sharding, sharding is top-down, and the partitioning condition is often the prefix of the account address. For example, if the workchain is evenly divided into 256 shards, accounts with address prefixes of 0x00, 0x01, …… 0xFE, 0xFF will be distributed to different shardchains. In the sharding mechanism of TON, sharding is a bottom-up dynamic process. It is more appropriate to imagine that each account is initially treated as a shardchain, and then they are combined into larger shardchains based on their relationships to ensure that each shardchain has a sufficient number of transactions.

Now let’s take another look at the architecture diagram of TON Blockchain. Does it have some similarities to network architecture? We have reason to believe that the Durov brothers, who come from a networking background, were inspired by network architecture when designing TON. In the initial situation, each network device works independently as a single point (each account as a shardchain). As communication between some network devices becomes frequent, they are combined into a LAN (combining single-point shardchains into larger shardchains), and communication between different LANs is facilitated by upper-level nodes (interoperability between shardchains is achieved through the masterchain).

TON Blockchain is essentially another form of network, which is the TON of the network.

By the Network

As a distributed system, blockchain requires communication between nodes through a peer-to-peer (P2P) network, rather than centralized servers and client-server architecture. For single-chain blockchains like Bitcoin and Ethereum, propagating blocks and transactions through the gossip protocol is sufficient. However, for TON, the multi-chain architecture imposes higher requirements on the network protocol.

TON nodes use the Abstract Datagram Network Layer (ADNL) for data transmission, which abstracts the network layer of the traditional TCP/IP protocol stack. To facilitate identity recognition, nodes communicate using abstract network addresses instead of IP addresses. This address is a 256-bit integer, derived from the hash value of ECC public keys and other parameters, enabling encryption and decryption of communication between nodes and providing the foundation for the separation of different Shardchains.

TON uses the Kademlia Distributed Hash Table (DHT) to locate other nodes in the network. When a client needs to submit a transaction to a Validator on a specific Shardchain, it can use a key to search and obtain the location of the Validator in the DHT.

The most critical part is the Overlay network. Since different Shardchains operate independently and do not care about or have the ability to process transactions on other Shardchains, an Overlay sub-network needs to be constructed for each Shardchain within the TON Network, open to nodes that wish to participate in communication. Within the Overlay network, communication is achieved through the gossip protocol based on ADNL.

With its unique network protocol design, addressing, transmission, and application are all finalized, enabling TON to achieve an infinite sharding solution and achieve extremely high TPS. This is TON by the network.

For the Network

In the era of “thousands of chains emerging,” for a public chain to stand out, it must play to its strengths and highlight its advantages. Ethereum stands out with its total value locked (TVL) and application ecosystem, Solana has a vast developer ecosystem, and Arbitrum excels in the reliability of its technology and operational capabilities. TON Blockchain is in a relatively new but rapidly rising position in the current blockchain market, and TON needs to differentiate itself with its unique multi-chain architecture and high scalability.

Firstly, its technological foundation makes it a highly flexible and scalable platform. With its innovative multi-chain architecture, it can easily handle a large number of transactions, addressing the scalability issues faced by many other blockchains.

Secondly, the close integration of TON with Telegram also gives it a competitive edge. Telegram’s massive user base provides TON with a large potential user group that many emerging blockchains do not have.

However, it also faces some challenges. Other blockchain projects have already established large communities and ecosystems, so TON needs to continually attract developers and users. Additionally, it needs to compete with other blockchain projects that have powerful features and innovative solutions, which means it must constantly innovate to maintain its competitive advantage.

In the competition with other mainstream blockchains, TON must prove its technological advantages and practicality, which will be the key to its future development. By demonstrating the security, speed, and efficiency of its system, it may attract more businesses and individual users.

Overall, the TON blockchain is in a highly competitive and dynamic market environment. Although it has some significant advantages, it still needs to prove its value, especially in a market that already has many mature and successful projects.

So what are the advantages of TON? In a market where various scaling solutions have matured and been implemented and “high performance” is no longer the key factor determining the success or failure of a blockchain, how does TON maintain the vitality of its ecosystem?

CGV Research believes there are two directions: social networking and web services.

From the perspective of social networking, we only need to consider the needs of users when using Telegram. With a large amount of import and export trade on Telegram, TON LianGuaiyment was created, and the wallet integrated into Telegram has lowered the barriers to use; there is a demand for users to showcase their artistic aesthetics, and TON NFT is a great social tool for that; playing games with friends is the most enjoyable thing, so GameFi can achieve rapid growth through social networking.

Web services are TON’s expertise. TON has reimagined everything about traditional networks and is considered the future of the internet. The anonymous eSIM realizes Telegram’s original vision of a privacy-protected social network; TON domains improve readability, making it easier for users to find each other in the TON network; TON URLs, TON proxies, and TON WWW aim to provide decentralization, security, and reliability for everyone; TON Storage is an upgraded version of Torrent that ensures the security of user data through decentralized storage.

TON uses blockchain technology not only to raise funds but also to build a more decentralized, secure, and reliable internet. This is TON for the network.

Conclusion

Unfortunately, based on the current level of activity in the TON ecosystem, it seems that there aren’t many users who need a more decentralized, secure, and reliable internet. This is also a problem faced by all blockchain projects at the moment. Most people enter the blockchain ecosystem to make money rather than for a genuine need for decentralized services. Without the wealth effect, it’s difficult for projects to sustain attention.

Fortunately, the TON ecosystem is not lacking in funds. TON has established an ecosystem fund worth hundreds of millions of dollars for investment and incubation of projects within the TON ecosystem. With the largest monthly active user base in the entire Web3 world, we have reason to believe that the future of the TON ecosystem will experience a burst of growth and is worth continuous attention.

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