Why did TONcoin go up by a third, and how is it connected with Telegram?

TONcoin (TON) has surged ahead of other tokens this week, rising nearly a third (29.4%, to be exact, according to Crypto Bubbles). On December 14, the value reached $2.83. And for the month, it was up 42.1%, though that’s still half the price of TON a year ago.

Market cap now stands at $2.92 billion, and trading volume over the past 24 hours is $93.39 million.

Although back in October, TONcoin was the leader among the losers. So what happened in December that made the token surge? And what to expect in the future? Let’s dive into the topic.

What is TONcoin (TON)?

To begin with, The Open Network’s cryptocurrency blockchain has a core coin called TONcoin or TON (formerly known as Gram). Nikolai Durov and his team created the network. He is the older brother of Pavel Durov, the creator of the popular messenger Telegram.

The project was founded in 2018, but then abandoned and moved under the TON Foundation and renamed from Telegram Open Network to The Open Network.

Since 2020, the project has evolved thanks to a group of enthusiasts called the TON Foundation. TONcoin, formerly known as Gram, is the native cryptocurrency of the TON network.

The original idea was to integrate TON into an easy-to-use application that allows users to buy/send/store funds. Customers pay transaction fees and use TON to settle or confirm transactions. TONcoin uses a Proof-of-Stake (PoS) consensus model.

The developers’ mission is to create a complete ecosystem with decentralized storage, decentralized services, a domain name system (analogous to DNS), an anonymous network, an instant payment platform, and accessible/fast transaction processing.

TON has a layered “blockchain within a blockchain” structure. Sharding involves the use of multiple subnets (shards) on a single blockchain, where each shard has a specific purpose. This allows the network to avoid the accumulation of untrusted blocks and speeds up the execution of tasks. 

The TON network offers such services:

• TON Wallets (built-in wallet for funds transfer and interaction with platform services) custodial and noncustodial; TON Services allows developers to create various dApps and users to access third-party applications through a convenient interface;
• TON Storage offers private encryption using the wallet owner’s private key;
• TON Proxy uses all components of the platform and allows customers to access the TON blockchain via decentralized VPNs;
• TON DNS (decentralized name system) makes it possible for traditional websites to operate on the TON network, allowing users to set short names.

Why did TONcoin suddenly start to skyrocket?

The reason for such a strong surge in TON quotations was most likely an innovative solution with the ability to purchase anonymous phone numbers for Telegram.

At the end of November, Durov announced the creation of a decentralized auction platform, Fragment, for bidding on anonymous phone numbers for Telegram. They are sold for TON and start with +888. Such numbers are NFTs based on a blockchain of the same name. They can be used to register a relatively anonymous Telegram account. In this case, there is no need to use a SIM card.

“Fragment has been an amazing success, with 50 million USD worth of usernames sold there in less than a month. This week, Fragment will expand beyond usernames,” he stated.

In addition, the founders of the project presented an interesting mechanism. The prices of all numbers that are not traded or not bought will be increased in price by 1 TON every three hours until they reach a certain limit. After that, they will be removed from the auction.

For example, some numbers are so popular that they sell for more than $100,000 at a Fragment auction. The most coveted number is +888 8 888, which is currently bidding for 38,290 tons, the equivalent of about $89,000 (as of December 15).

Also on December 12, the TONcoin team announced the launch of the decentralized exchange DeDust in the project ecosystem, in addition to the two already working – TonSwap and STON.fi.

Moreover, on December 14, it became known that cryptocurrency exchange Bitget will start listing TON. And from December 21 will start trading Toncoin in the pair TON/USDT.