Blockworks Research These Limitations Could Make TON Difficult to Become the Next SOL or ETH

Blockworks Research These Limitations Could Make TON Difficult to Become the Next SOL or ETH

Blockworks Research These Limitations Could Make TON Difficult to Become the Next SOL or ETH

Author:
Blockworks Research
Translator: Felix, PANews

Recently, there has been a high level of interest in the narrative surrounding TON and Telegram, with many believing that TON will be the next SOL or ETH. Blockworks Research has provided an analysis, suggesting that TON’s subsequent growth is lacking and may disappoint the public.

Content Table
Toggle
Low user stickiness on Telegram
Incompatibility with EVM, minimal use of programming languages
Limited coverage in the terminal market
Overvalued FDV
Telegram possesses global influence and significant daily active users (DAU), which can be directed to TON. By this standard, Telegram is one of the most widely used applications globally.

According to data provided by Telegram, it is one of the most popular applications globally, with a total user base of 900 million, ranking 8th among global applications.


However, when measured by DAU, Telegram’s user stickiness is overestimated.

The DAU/MAU ratio of various social applications in the following figure shows that despite high MAU (monthly active users), Telegram’s DAU is relatively low (ranging from 55 million to around 200 million, which is very low compared to competing applications), and the DAU/MAU ratio is only 15%.

In comparison, Facebook’s ratio is 69%, Wechat is about 67%, Instagram is 60%, TikTok (only in the US market) is 49%, and Twitter (X) is 45%. This indicates that Telegram’s market penetration is low, and its profitable user base is lower than market expectations.

PANews Note: The DAU/MAU ratio can measure user stickiness of websites or applications.

The TON ecosystem team will face challenges with the lack of EVM compatibility and FunC (the native programming language of the blockchain).

The Ton Virtual Machine (TVM) is incompatible with the Ethereum Virtual Machine (EVM) because TON adopts a completely different architecture (TON is asynchronous, while Ethereum is synchronous). Therefore, the TON ecosystem does not support development in Ethereum’s Solidity programming language.

According to a 2023 developer survey report (with over 90,000 developers participating), Rust is the most favored language, with over 80% of developers hoping to use it again next year. 46.4% of developers expect to use Solidity.

Meanwhile, TON supports three programming languages: Fift, FunC, and Tact. Currently, FunC is the most used language. Although FunC looks similar to the C language, it is generally not well-known or favored.

A significant part of the TON narrative growth is based on the belief that Telegram will become the next WeChat. However, WeChat is blocked outside the US market and only serves the Chinese market.

In contrast, the current application market is dominated by financially strong tech giants with a well-established network effect, and Telegram’s largest market distribution is in the dispersed markets of the Asia-Pacific region (excluding China and Eastern Europe), adding complexity for startups distributing through Telegram.

Below is the annual download distribution of Telegram in 2022:
India: 104 million downloads
Russia: 34 million downloads
Indonesia: 27 million downloads
USA: 26 million downloads
Brazil: 21.94 million downloads
Egypt: 14.85 million downloads
Vietnam: 11.84 million downloads
Mexico: 11.61 million downloads
Ukraine: 10.76 million downloads
Turkey: 9.79 million downloads

Despite these realities, TON still has tremendous growth potential, with little safety margin for new investors.

The following figure shows that among all public chains, TON’s FDV is 8.6 times the network annualized DEX trading volume, ranking first and at the highest level.

Furthermore, FDV is 927 times the network annualized fee, ranking high among all public chains.

Related Reading:
An overview of 10 interactive new projects in the TON ecosystem
Original article link
This article is authorized to be reprinted from PANews.