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Telegram’s TON blockchain will surge 1,000% in 2024, but DeFi activity is still small – DL News
- The TON blockchain has grown 10x this year.
- Part of this growth is due to the adoption of USDT on the blockchain.
- TON still lags behind major blockchains in the DeFi business.
User activity is abuzz on TON, a blockchain network with ties to messaging app Telegram.
The network’s total value locked, or TVL (a DeFi metric that tracks capital invested in a protocol or blockchain) has grown 10x this year, establishing itself as one of the best-performing blockchains in decentralized finance.
Over the past month, TON blockchain performance continued its upward trajectory, with TVL rising 46% and peaking at $260 million, DefiLlama data Shows.
The increase in TVL coincides with the implementation of Tether’s USDT stablecoin on the blockchain in April.
TON’s TVL has increased 46% since adopting USDT
USDT is the largest stablecoin in cryptocurrencies with a market size of $110 billion. Half of that volume is on Tron (not to be confused with Ton), a blockchain with $8.6 billion in investor assets.
The stablecoin’s appeal comes from the low fees users pay when sending and receiving USDT. This is what the network does particularly attractive in developing countries where stablecoins have become a tool to protect wealth against inflation and monetary devaluation.
But TON developers could aim for a share of the stablecoin market by integrating USDT onto their blockchain.
To achieve this, they could leverage Telegram’s 800 million monthly active users to overcome the cold start problem, a common challenge for new blockchains trying to generate initial activity on their networks.
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It seems that TON developers are already taking steps in this direction.
Telegram integration
The TON blockchain has a crypto wallet integrated into the Telegram app, which allows users to send USDT to their contacts around the world directly from the app.
This is not the only incentive introduced by the TON team to promote USDT adoption on the network.
Users who hold USDT on their Telegram mobile wallets can earn up to 50% annualized returns, much higher than the average DeFi interest rate offered by lending protocols. The yield comes from TON token rewards to provide liquidity on major decentralized exchanges on the blockchain.
Aside from retail stablecoin transactions, TON has yet to establish itself as a solid DeFi chain. This means hosting DeFi protocols that can command significant user activity.
TON’s current DeFi market is dominated by Tonstakers and STON.fi. Tonstakers is a liquid staking protocol that allows users to earn yield by locking TON tokens, and STON.fi is the largest decentralized blockchain swap exchange.
However, the combined market size of these two protocols pales in comparison to projects on major blockchains like Ethereum and Solana. Additionally, the network has been unable to attract established DeFi projects to implement their protocols on-chain.
Osato Avan-Nomayo is our DeFi correspondent based in Nigeria. He covers DeFi and technology. To share story tips or information, contact him at osato@dlnews.com.