Cryptocurrencies

TON Returns to the Attention of Investors: Does This Herald a New Bull Market?

Five years have passed since Pavel Durov raised a record $1.7 billion during a token sale for his brainchild messenger Telegram. Following legal disputes with the SEC, Telegram eventually conceded, refunding the invested capital to its backers. It appeared that this marked the conclusion of the saga. However, in September, Telegram introduced a cryptocurrency wallet to its application, which boasts an audience exceeding one billion users worldwide. Today, the TON cryptocurrency ranks among the top 10 cryptocurrencies by market capitalization.

Pavel Durov introduced the Telegram messenger in August 2013. This innovative application quickly gained popularity due to its user-friendly text messaging features and minimalist design. Over time, Telegram has evolved to support video calls, video and audio messages, group chats, and news channels. Thanks to its continuous development efforts, the messenger has consistently ranked among the top 5 most downloaded applications globally since 2020.

In 2018, following the prevailing trend of initial coin offering (ICO), Telegram had ambitious plans to launch an ICO. In closed funding rounds, the company managed to secure two billion dollars in investments even before initiating the public sale of its Gram tokens. These figures could set a record, overbeating the EOS project, which raised $1.3 billion in 2017. However, Telegram's ICO journey hit a roadblock when the US Securities and Exchange Commission (SEC) intervened.

Following the SEC's classification of Gram as a security, Telegram was compelled to halt its ICO and suspend the entire project. In 2021, the company diligently refunded all the funds it had raised to its investors. Speculation about the company's intention to pursue an IPO started circulating in the media. However, the story is far from its final chapter.

In 2020, an independent developer community introduced a blockchain called The Open Network, and by 2021, the TON cryptocurrency had made its debut on exchanges. Notably, neither the blockchain nor the cryptocurrency had any official ties to Pavel Durov or Telegram. The new cryptocurrency has demonstrated remarkable performance, securing a place among the top 10 cryptocurrencies by market capitalization within just two years. During August and September of this year, it exhibited consistent growth, with its value increasing from $1.19 on August 1 to $2.57 on September 20. As of the current moment, TON is trading at $2.

TON has witnessed a 93% increase in value during this period, a stark contrast to Bitcoin's (BTC) 10% loss and Ethereum's (ETH) 14% decline. These robust indicators may be attributed to the launch of a specialized cryptocurrency wallet extension for the Telegram application" This wallet currently supports TON, USDT and BTC, offering users the capability to engage in P2P trading and facilitating cryptocurrency purchases via bank cards.

Today, the TON blockchain offers features such as smart contracts and NFTs, akin to popular cryptocurrencies like ETH. Notably, Telegram users worldwide, excluding the United States, can easily acquire TON cryptocurrency with just a few taps on their smartphone screens. It's important to highlight that the recently added wallet within the application is not directly affiliated with Telegram.

Pavel Durov and the Telegram team have learned valuable lessons from their cryptocurrency ventures. While they seem to be distancing themselves from direct involvement in the cryptocurrency sphere, they remain vigilant observers. With a monthly audience of 800 million users, despite being prohibited in countries like China, Pakistan and Iran, and with U.S. citizens restricted from using the wallet, it's plausible to imagine that TON and Wallet could propel Telegram to become the world's foremost application, the first messenger to integrate cryptocurrency support. Will this have an impact on TON's price? Could explosive growth be on the horizon for TON cryptocurrency?

These are indeed challenging questions. The history of cryptocurrency has witnessed analogous examples, as evidenced by BTC and ETH. However, even they didn't offer the convenience of messenger-based mobile purchases. Perhaps answers to these questions will emerge as the situation evolves, and the reactions of global regulators, who may scrutinize the relationships between the application, wallet, cryptocurrency, and their creators, become clear. Yet, the potential for the new all-time high values remains high.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Julia Magas

Julia Magas is a researcher/journalist who covers the latest trends in finance and technology. Her works are published on Cointelegraph, Investing, SeekingAlpha, Beincrypto, Coincodex, where she interviewed the representatives from MIT, Binance, IRS, Bitcoin Cash, Ethereum, Algorand, the Austrian government, Grant Thornton, and more.

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