Toncoin: Getting Your Way. Part 2

    30 May 2022

    The Toncoin cryptocurrency was developed independently, but the concept and first drafts got designed by Pavel Durov, the creator of the Telegram messenger. Hence the project’s market niche – it is digital money to pay for services within Telegram. What are Toncoin’s prospects and uses, and does it have a future – let’s find out!

    Today, TON Foundation is a decentralized community of programmers, designers, marketers, and business developers. Active members work on the project to the extent of their abilities and resources, developing the technological components and growing the blockchain.

    More than 60 developers in total are employed full-time, including a group of core specialists and several independent product teams. The project has separate content (about ten people) and moderation (about twenty people) teams. The exact number of marketing specialists is difficult to estimate, but there are more than a dozen of them in different units. There is also a bridge between TON and Ethereum networks launched at the beginning of the year.

    In the developers’ own words, the main task of TON Foundation right now is to create a next-generation global network with decentralized file storage, an anonymous domain name system, instant payments, and convenient services. In other words, to bring to life the Durov brothers’ vision of a few years ago.

    As we have mentioned, all 5 billion minted network tokens were sent to Proof of Work Giver smart contracts, and the only way to get them is through traditional mining. Users run special software that iterates over the hash and sends proposed solutions to PoW Giver contracts. The higher the equipment performance, the better your chances of earning the coin. Pools don’t work, so everyone mines solo.

    Those wishing to mine the Toncoin cryptocurrency are recommended to install Linux, though mining was also opened on Windows at the beginning of the year. TON source code is actually built on Windows, xBSD, and other operating systems, but TON mining utility is not installed automatically. On Linux, you need to set up the software manually and create your own scripts.

    But let’s move on to criticisms of the project – and I must say, there are quite a few. First and foremost, Toncoin is not really Telegram’s internal cryptocurrency. Integration with the messenger is done via a bot – a third-party service that anyone can create, even those not particularly versed in programming. The Telegram developers themselves did nothing to integrate the token into their brainchild. In fact, they continue to officially dissociate themselves from the crypto project to avoid problems with the American authorities.

    Secondly, Toncoin is not fully decentralized: it is unclear how the tokens are distributed, and there are serious concerns over the project having some kind of shadow management. Toncoin is also not anonymous – to use it, you need to link a bank card to the bot.

    What is worse, there is no structure to guarantee at least some degree of reliability, nor is there an insurance fund. Who will be held accountable if the money just disappears? Some Cyprus-based bot developer?

    In this day and age, a cryptocurrency must occupy a certain market niche to be successful. Some cryptocoins are convenient for transferring money, some have an increased level of anonymity; others are used for farming or gaming, etc. And yes, some coins have the advantage of being widely used, allowing them to have a broad circulation and high liquidity in terms of exchange for fiat money, other cryptocurrencies, real and virtual goods and services.

    Of these advantages, which does Toncoin have? Advertising that uses the popularity of Telegram, a messenger bot, and being traded on several mid-sized crypto exchanges?

    To those familiar with Telegram, even the “bot will be your crypto wallet” approach seems surprising. How can someone else’s bot be your wallet? A soft wallet is secure, of course, in a limited sense, as are custodial services and exchanges. But in that case, the wallet is tied to your device, where the software can theoretically be checked for bugs and data leaks. An exchange has its credibility to uphold and will not scam the clients at the risk of hurting its business. But what prevents the bot from taking or losing the user’s money? Disappearing completely or ceasing to operate? It’s not on your device, so you can’t control it in any way. Legally, no one is responsible for it. How do you even prove that you had something in it? And who do you prove it to?

    Toncoin would make a huge difference and be welcomed with open arms if it was built into the Telegram app itself and each user had a Toncoin wallet by default. But Pavel Durov made it clear that this would not happen.

    Meanwhile, TON Foundation developers launched their subscription-based social network – Tonplace – which features cryptocurrency payments. The content in it can be monetized, for example, by publishing exclusive posts and sending private messages to subscribers. To register in Tonplace, users must authorize through Telegram and give their phone number.

    Tonplace subscription costs two Toncoins. Most of the functions are unavailable without it, so you cannot subscribe to anyone or publish posts. Toncoin is also how you monetize your content on the platform.

    To summarize: Toncoin is an exciting and unconventional cryptocurrency, which, unfortunately, raises a lot of concerns regarding its prospects and reliability. But it is still worth watching: the token may well “click”, given the growing popularity of Telegram and the developers’ determination.

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