Telegram ads will be paid with TON, what impact will it have on TON?

2024-03-01 16:30

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Original Title: "What impact will Telegram advertising with TON payments have on TON?"

Original Author: Frank, PANews

On February 28th, Pavel Durov, the founder of Telegram, announced on his personal Telegram channel that starting next month, Telegram channel owners will be able to receive financial rewards for their work. He stated that currently, Telegram broadcast channels generate 1 trillion views per month, but only 10% of those views are monetized through Telegram Ads, which is a promotion tool designed with privacy in mind. In March, the Telegram advertising platform will officially open to all advertisers in nearly 100 new countries. Channel owners in these countries will begin to receive 50% of the revenue earned by Telegram from displaying ads on their channels. To ensure fast and secure payment and withdrawal of advertising revenue, the TON blockchain will be used, and revenue will be shared with channel owners through Toncoin, which will be sold for advertising purposes.

Once the news was released, TON tokens rose sharply, with a short-term increase of up to 38%, and the highest price reached $2.95. However, after 4 hours, the TON price experienced a significant decline, with a maximum drop of 25%, and the lowest price dropped to $2.2, almost returning to the level before the rise. What benefits will this change bring to the TON chain specifically? Or is it another short-term market stimulus by Telegram?

Or increase 2 billion advertising revenue with no dividend benefits

Perhaps it is the lukewarm attitude that has persisted for a long time that has led Telegram founder Pavel Durov to repeatedly provide blood transfusions to TON through mergers and acquisitions. So, in terms of the cooperation launched this time, what is the actual impact on TON?

In this critical information, Pavel Durov mentioned that Telegram broadcast channels generate 10 trillion views per month, but only 10% of the views are monetized through Telegram Ads. With the new advertising plan launched in March, channel owners will receive 50% of the advertising revenue, which will be traded through Toncoin.

PANews saw in Telegram's official advertising statement that the current CPM (cost per thousand impressions) for Telegram is as low as 2 euros. Based on Pavel Durov's mentioned monthly viewing volume of 10 trillion times and 10% of ad viewing volume, the number of ad plays is about 1 billion times. Based on the minimum CPM value, Telegram's minimum monthly advertising revenue is about 200 million euros, and the total revenue of channel owners is at least 100 million euros per month.

Another report has also essentially verified this data. According to a report from Telega.io, the largest advertising trading market for Telegram in the Russian language sector, the Telegram user group in Russia exceeded 50 million in 2021, and the advertising revenue in the Russian language market reached 285 million USD that year. Based on the current claim of 800 million Telegram users worldwide, the global advertising revenue for Telegram is approximately 4.56 billion USD. Based on this data, the data that can be traded on the Toncoin chain is approximately 2.28 billion USD per year.

However, it is worth noting that this income is not shared with TON token holders, but is traded on the TON blockchain. Therefore, this news is very different from the dividend for holders proposed by Uniswap some time ago. However, based on the current on-chain data of TON, even if only such a large transaction volume is conducted on the chain, it will still improve the overall activity level of the chain.

Currently, according to Telega.io, there are 4,351 channel owners in the market who are verified ad providers, while the number of active advertisers is only around 70,000. Therefore, in terms of user growth, the potential impact may not be significant. However, the assets deposited in Toncoin through advertising fees by Telegram have become a concern for the community.

In response to concerns that Telegram's heavy promotion of TON may lead to adverse effects on the decentralized ecosystem due to the company holding too much Toncoin, Pavel Durov has proposed a solution. To limit Telegram's share of TON to about 10% of the supply, they plan to sell the excess TON holdings to long-term investors at below-market prices, with lock-up and vesting plans ranging from 1 to 4 years. This will lock up freely circulating TON, stabilize the ecosystem, and reduce volatility. Additionally, Telegram has set up a new email address for high-value investors (over $1 million) to express interest.

Telegram's Bumpy Cryptocurrency Journey

Speaking of TON, most people may think of Telegram's official encryption plan TON public chain. However, the current TON is essentially not a blockchain public chain directly controlled by Telegram.

In 2019, Telegram attempted to launch the "Telegram Open Network" (TON) blockchain network. TON is a multi-purpose blockchain platform designed to provide faster speeds and greater scalability than Bitcoin or Ethereum, in order to support global payments and decentralized applications. However, the project was cancelled after a series of legal battles with the US Securities and Exchange Commission (SEC).

The TON project was originally planned by Telegram, but after reaching a settlement with the SEC, Telegram announced that it would no longer be involved in the TON project. Subsequently, the community and other developer teams decided to continue the project and launched several branch projects based on TON, such as Free TON (later renamed Everscale) and TONcoin. These projects inherit TON's technological vision and aim to create a high-performance blockchain platform, but they no longer have direct contact with Telegram. The TON public chain that we are familiar with today, named The Open Network, is the most mature public chain project that has grown after Telegram's official encryption plan was terminated. Although TON is not directly related to Telegram, Telegram officials and founder Pavel Durov have supported the project multiple times in recent years and emphasized the business connection between Telegram and TON.

In December 2022, Telegram announced that users can purchase anonymous numbers on the Fragment blockchain by paying with Toncoin. Stimulated by the news, TON rose 30% from $1.84 to $2.4, with prices reaching as high as $2.8. Despite Fragment's trading volume exceeding $5000 in the following month, TON's market performance did not continue to remain strong, but instead fell all the way down to a low of $0.96 as the crypto bear market took hold.

With 800 million users, eager to build the world's largest public chain

According to the official introduction of TON, as of 2022, TON blockchain is still one of the few truly scalable blockchain projects. Therefore, it remains the most advanced blockchain project, capable of executing millions of truly Turing-complete smart contract transactions per second, and even tens of millions in the future if necessary.

In its official performance comparison with other public chains, TON seems to be able to crush Ethereum and Solana in all aspects.

In 2023, Steve Yun, the President of the TON Foundation, revealed in a speech that their goal is to attract 30% of Telegram's users to join TON before 2028. It is expected that TON will have 500 million active users by 2028.

Although the goal is ambitious and backed by the strong support of Telegram's 800 million users, TON's progress seems to be less than ideal at the moment. As of March 1, 2024, there were approximately 1.56 million wallets activated on the TON blockchain, with a historical peak of 32,439 daily active users. By comparison, Ethereum has approximately 110 million wallets activated on its blockchain.

Overall, Telegram is widely recognized in the industry as a Web3.0 product with strong genes. Especially with the growth of more and more Telegram bots and encryption tools. As one of the world's largest social platforms, Telegram also has enough potential to become the king of the encryption industry. However, the current performance in the market, such as the ambiguous relationship with TON, may be the best feedback.