Cryptocurrency is a relatively independent emerging technology with unique challenges on its path to widespread adoption. While blockchain projects promise to disrupt established tech businesses, they require building a thriving community of active users who have shifted their activities from established avenues to the cryptocurrency space.
The challenge for blockchain projects is significant since established technologies largely operate well. Moreover, there are currently thousands of blockchain projects, often similar to each other, competing for the same attention and user base. Most of these projects are essentially “a technical concept trying to build a community from scratch.”
As a leading communication platform for cryptocurrency, Telegram is on its way to reaching 1 billion active users. Telegram’s versatility, security, and speed make it the platform of choice for cryptocurrency users, facilitating seamless communication between individuals and teams.
For the industry, Telegram plays a crucial role in large-scale community building, providing projects with tools to interact with their audience, disseminate information, and foster a sense of belonging. It might be one of the best tools for cryptocurrency projects to build communities.
Telegram’s large user base and free, open API present an unparalleled opportunity for cryptocurrency projects to integrate their products into an existing, vibrant community with a significant number of cryptocurrency users. Recognizing this potential, TON stands out due to its high strategic alignment with Telegram. However, signs indicate that other blockchain ecosystems will also integrate further into Telegram.
Telegram’s Rapid Development
Since being announced as Telegram’s “official Web3 infrastructure” at the TOKEN2049 event in Singapore in September 2023, TON has garnered widespread attention and performed well across the cryptocurrency market. At the event, Telegram and the TON Foundation jointly announced TON Space, a new self-custody wallet directly integrated into the official Telegram wallet, and included Telegram Wallet in the setup and attachment menu for all non-U.S. users.
TON Space is a game-changing product. While some might view it as merely adding a self-custody wallet to Telegram, the broader perspective is that Telegram has effectively become a self-custody wallet with nearly 1 billion users, seamlessly connecting users with numerous crypto applications within the platform and allowing private or group communication without leaving the platform. No other wallet offers such a user experience.
Most wallets, apart from simple transactions, lack direct app integration or social features, requiring users to undergo cumbersome login processes across different browser-based applications, severely limiting usability. Telegram’s all-in-one experience is crucial for mass adoption.
Imagine if Instagram or X required you to log into a separate browser application to send messages or comment on a friend’s post, or if you had to use a different browser application to attach files from cloud storage to emails.
The renewed collaboration between Telegram and TON has attracted the attention of prominent venture capital firms, with Pantera Capital making the largest investment in TON to date, and other firms expressing recent interest.
Unlike most blockchain projects struggling to build new communities, TON’s deep integration with Telegram positions it as a “community integrating blockchain.” As Pantera noted in their investment letter, “It must be easier.”
TON: The Spotify of the Cryptocurrency World
TON’s recent embedding into Telegram reminds me of Spotify’s cooperation and integration with Facebook in 2011, a pivotal moment for the music streaming industry. Spotify’s integration with Facebook allowed users to share their listening habits and playlists directly on the massive social media platform, significantly boosting Spotify’s visibility and usage. In just four days, Spotify gained 1 million new Facebook-linked users.
In six weeks, Facebook-linked Spotify users shared over 1.5 billion listening activities through Facebook’s Open Graph, allowing developers to integrate their apps into the social media platform. From that point, the rest is history.
Similarly, TON’s integration with Telegram allows TON developers to integrate their applications into Telegram’s vast social network, making it easier for users to discover and use TON’s applications and services. Just as Spotify built a community around music sharing using Facebook’s social graph, TON is building a community around value transfer using Telegram.
Since Telegram endorsed TON, it has maintained steady growth. Recently, the total value locked (TVL) in TON smart contracts exceeded $1 billion, a two-order-of-magnitude increase since the event.
TON’s daily active wallet numbers continue to hit record highs.
TON’s token holders and transaction volumes show strong upward trends.
While analogies have limitations, there are striking similarities between Facebook and Spotify and Telegram and TON. In Q3 2011, when Facebook integrated Spotify, Facebook had around 800 million users, while Spotify had 2 million paid subscribers.
Less than a year later, Spotify’s paid subscribers grew to over 4 million. Similarly, when Telegram integrated TON in Q3 2023, Telegram also had around 800 million users, while TON had about 100,000 monthly active wallets. Less than a year later, TON’s monthly active wallets grew to around 5.5 million.
While TON’s active user growth is significant, directly comparing Spotify subscribers from a decade ago to current active TON wallets is inaccurate. The important point is that new technology adoption has seen significant growth after integrating into a large social network.
Given that TON has only touched a small part of the Telegram user base so far, it’s reasonable to expect continued growth as technology improves and use cases expand.
Beyond TON: Cryptocurrency on Telegram
Although Telegram has officially endorsed and given TON some exclusive benefits on its platform, they likely remain independent organizations due to legal issues. This is good news for other blockchain projects, as Telegram maintains its API free and open for developers, fostering healthy competition and innovation.
When discussing TON and Telegram, it’s important not to overlook other ecosystems integrating into Telegram. Notably, NEAR might be the second most integrated chain with Telegram, quietly establishing a strong presence on the platform.
The most notable example is NEAR’s self-custody HERE Wallet and its lightweight Telegram implementation, HOT Wallet, launched in early February. HOT Wallet focuses on user engagement and streamlining access to the NEAR ecosystem through Telegram, serving as NEAR’s response to the Telegram TON wallet.
Creating a new NEAR account with HOT Wallet is as simple as opening the Telegram app and tapping the screen a few times to generate a readable NEAR address automatically assigned to your Telegram username (e.g., blockhiro.tg).
To increase user engagement, HOT Wallet adopts the gamification strategy popularized by the Notcoin app on TON, which attracted millions of users in its first week after launching a month ago. Like Notcoin, HOT Wallet users can mine its native tokens directly within the app through a fun game combined with social features, tasks, and upgrades.
Within 10 days of launch, over 1 million Telegram users created NEAR accounts on HOT Wallet. Since its launch, it has repeatedly ranked first on DappRadar.
In Q1, HOT Wallet averaged around 370,000 daily users, accounting for nearly 30% of NEAR’s daily active addresses. So far in Q2, average daily active users have increased to around 500,000.
NEAR’s success on Telegram raises a question: Will TON continue to be Telegram’s only Web3 infrastructure, or will it be one of several? While TON has received attention, NEAR and other potential blockchain projects should not be overlooked. In the coming months and years, I will closely monitor other blockchain ecosystems’ dynamics.
tApp (Crypto Applications on Telegram)
Recent crypto applications on Telegram, known as “tApps,” have improved user experience—from monotonous proxy page-like trading bots to fully developed applications—paving the way for more highly engaging mining games and other tApps.
Notcoin and HOT Wallet are just the beginning. There are now numerous popular “mining +” tApps across multiple chains, attracting millions of players by offering simple and fun play-to-earn methods. Here are some examples:
The user growth of these seemingly simple applications is extraordinary! For example, Hamster Kombat reached 100 million users in less than three months, placing it between ChatGPT and TikTok in terms of user acquisition speed. Simple estimates indicate that within months of the app’s launch, at least 10% of Telegram users tried the game, demonstrating Telegram’s powerful influence in Web3 user acquisition (user retention is another matter).
As the tApp category evolves, signs indicate they are moving towards multi-chain development (e.g., MemeFi, Blum) and are no longer just Notcoin imitators (e.g., AVACOIN, PixelTap). Some people associate this category with meme coins because of Notcoin’s meme nature, but I disagree. In some ways, current tApps and meme coins are similar in emphasizing convenience and fun—quite different from the serious technical jargon often seen in the crypto space.
However, unlike meme coins, tApps provide complete functionality, such as games and tasks, attracting millions of potential crypto-ready users already on Telegram or willing to join Telegram.
Crypto-integrated applications on Telegram started small, but now is the time for them to evolve into more complex platforms rivaling other mobile applications. New tApps can combine and merge gaming, social, and other engagement mechanisms, offering a richer user experience for cryptocurrency users and newcomers.
Multi-chain tApps will further solidify Telegram’s position in the broader cryptocurrency industry, strengthening the existing connections between various crypto communities and Telegram. If these applications can attract not only Telegram’s existing user base but also new users and developers, it could incentivize Telegram to provide more support for more chains. This could be achieved by offering broader API access, higher server-side rate limits, or extended availability in settings and menus.
Conclusion
To achieve mass adoption, we should look beyond TON or any specific blockchain protocol and consider Telegram in the broader context of digital assets, information security, and globalization. Telegram has become a global communication giant with extensive penetration in North America, Latin America, Asia, and Europe.
Its massive user base, combined with innovative features at the forefront of information security and tech adoption, makes Telegram the best platform to bridge the crypto island with the mainland. Just as Facebook in the 2010s gave rise to Spotify and the rise of music streaming, Telegram is the right product to accelerate blockchain adoption and normalize on-chain value transfer in the 2020s.
When discussing obstacles to the mass adoption of crypto, the most common argument I hear is user experience (UX). Many believe the main reason hindering mass adoption of crypto is poor user experience. However, I no longer think this is the case.
The rapid growth of accounts and activities on Telegram Wallet, Here Wallet, and tApps like Notcoin and Hamster Kombat indicates that the crypto user experience is essentially ready for mainstream use. If this were not the case, these applications could not have grown to millions of users within days.
I believe the real bottleneck is the lack of integration between isolated blockchain projects and larger social networks. Imagine what kind of activity would occur if these games were launched as standalone applications outside Telegram.
Just as streaming technology revolutionized how we consume audio and visual content by making it more accessible and convenient, blockchain projects should aim to achieve the same effect for value transfer.
This won’t happen in isolation. It will happen on platforms like Telegram, where blockchain applications can make value transfer between individuals, groups, and applications more accessible and convenient than anywhere else.
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