TON Foundation and the Telegram Blockchain: Inside the Network That's Chasing a Billion Users

Few blockchain projects in the current cycle have undergone a structural transformation as dramatic as The Open Network. What began as an abandoned Telegram side project  killed by an SEC order in 2020 — has been rebuilt by an independent foundation into a top-20 cryptocurrency by market cap, backed by Sequoia Capital, Benchmark, and Ribbit Capital, and now directly controlled by Telegram itself. The TON Foundation's story in 2025 is not just a token price narrative. It is a case study in how blockchain governance, institutional capital, and mass-market distribution strategies interact — and what it means when a messaging app with hundreds of millions of users decides to make crypto its infrastructure layer.

1. What the TON Foundation Is and How It Got Here

To understand the TON Foundation's current position, traders need to understand the unusual origin story that shaped it. In 2018, Telegram  the encrypted messaging platform with over 900 million active users  began developing a blockchain internally. The project, then named the Telegram Open Network, raised $1.7 billion in one of the largest ICOs in history. The native token was called Gram. Two years later, the SEC filed an emergency action arguing the Gram token constituted an unregistered securities offering. Telegram settled, returned the capital to investors, and publicly abandoned the project.

What happened next is structurally important for understanding what the TON Foundation is today. A decentralized community of independent developers  primarily based in Russia and Switzerland  adopted the open-source codebase, rebranded the network from Telegram Open Network to The Open Network, renamed the token to Toncoin, and established the TON Foundation as a Swiss nonprofit to govern and develop the ecosystem. The original founders, Nikolai and Pavel Durov, were not involved in the early post-Telegram phase. The foundation was established by Anatoliy Makosov and Kirill Emelianenko, members of what became known as the NewTON community.

This origin creates a governance structure that is distinct from most Layer-1 blockchains. TON is not a venture-backed startup-turned-foundation like many Ethereum-adjacent projects, nor is it a founder-controlled entity. It emerged from community stewardship of orphaned infrastructure  which creates both legitimacy in terms of decentralization and challenges in terms of coordination and long-term strategic direction.

The blockchain itself is technically sophisticated. TON uses a proof-of-stake consensus mechanism with a multi-level sharding architecture  often described as "a blockchain of blockchains"  where the network is divided into a masterchain coordinating validators and multiple workchains handling smart contract execution and dApp requests. Each workchain is further split into shardchains that process transactions in parallel. This architecture is designed specifically for high-throughput, low-cost operation at scale — a prerequisite for a platform that aspires to serve Telegram's user base as a live payments and applications layer.

The vision articulated by the TON Foundation has been consistent: empower 500 million users to own their digital identity, data, and assets by 2028 — with Telegram as the primary distribution vector. Whether that vision is executable depends on a set of technical, commercial, and regulatory factors that are actively evolving through 2025 and beyond.

2. The $400M Capital Raise, Institutional Backing, and the Treasury Company Strategy

The most consequential development for TON Foundation's institutional profile in 2025 was its $400 million capital raise  executed not through a traditional venture round but through a structured purchase of Toncoin from early investors. The firms involved represent a who's who of established crypto and tech venture capital: Sequoia Capital, Ribbit Capital, Benchmark, Kingsway Capital Partners, Draper Associates, CoinFund, Hypersphere, and SkyBridge, among others.

The structure of this raise is worth examining carefully. Rather than new equity in a company, the capital was deployed to purchase existing TON tokens from early holders. This is a secondary market transaction that consolidates significant institutional ownership in Toncoin without creating new supply. For traders, the implication is meaningful: a cohort of well-capitalized institutional investors with long time horizons now hold substantial TON positions, creating structural demand support and signaling long-term conviction in the network's trajectory.

Shortly after the raise was announced, the TON Foundation took the strategy a step further. In partnership with Kingsway Capital Partners  whose leader Manuel Stotz also serves as president of the TON Foundation the foundation announced plans to launch a publicly traded crypto treasury company focused on holding Toncoin. The structure mirrors the MicroStrategy model applied to Bitcoin: a public company whose primary asset is a digital token, providing institutional and retail investors with regulated, equity-market exposure to Toncoin without direct token custody. The capital raise for this entity was structured as a private investment in public equity, with a SPAC merger being considered as the route to public listing. Cohen & Company  which previously advised on a $1.5 billion Ethereum-focused SPAC transaction — was reported as an advisor on the formation.

Separately, Canary Capital filed for a Pengu-style hybrid ETF structure for Toncoin exposure, while Coinbase Ventures confirmed a position in TON  described by the foundation as a significant vote of confidence from one of the most prominent institutional validators in the crypto space.

The cumulative picture is of a project that has successfully completed the transition from community-run open-source network to institutionally backed financial infrastructure. For traders evaluating TON as an asset, this institutional layer introduces a different demand dynamic than typical retail-driven altcoins. Institutional holders tend to have lower velocity  meaning they hold rather than trade frequently which can reduce float and dampen short-term sell pressure while providing price floor support during broad market corrections.

3. Telegram's Takeover, Tolk 1.0, and the Make TON Great Again Roadmap

The single most market-moving development for Toncoin in 2025 came not from the TON Foundation itself but from Telegram's founder Pavel Durov. In early May 2025, Durov announced that Telegram would take direct operational control of The Open Network — replacing the TON Foundation as the primary governance driver and positioning Telegram as the network's largest validator. The announcement triggered a 36% single-session price spike, with the week-on-week gain exceeding 60%. Staking inflows jumped approximately $191 million in a single day  the highest level in nearly four months  as investors repriced the token to reflect what amounts to a fundamental change in the project's risk profile and adoption potential.

The strategic logic is straightforward. Telegram's user base exceeds hundreds of millions of active users globally. Its in-app wallet infrastructure already enables Toncoin and USDT transactions  making crypto as accessible as sending a text message, as the foundation describes it. Telegram's Mini Apps ecosystem has already attracted hundreds of applications built on TON's blockchain, from games and DeFi interfaces to payment tools and NFT platforms. With Telegram directly controlling the validator infrastructure, the alignment between the messaging platform and its blockchain layer becomes structural rather than advisory  a materially different proposition for any application developer or institutional partner evaluating the ecosystem.

On the technical development side, the foundation launched Tolk 1.0 in July 2025 — a native programming language for TON smart contracts designed to lower the barrier to entry for developers building on the network. Previously, TON smart contracts were written in FunC, a low-level language with a steep learning curve that limited developer adoption compared to Solidity-based ecosystems. Tolk introduces a more accessible syntax with full tooling for migrating existing FunC contracts, directly addressing one of the ecosystem's most cited structural weaknesses relative to Ethereum and Solana.

The broader roadmap  internally referenced as the Make TON Great Again initiative  outlines further milestones including the Catchain 2.0 consensus upgrade targeting sub-400ms block finality, near-zero transaction fees to drive mass adoption, TON Teleport as a Bitcoin bridge expected in mid-2026, and upgraded Layer-2 payment channels through TON Pay 2.0. The Builders Portal 3.0 upgrade and an AgenticKit AI toolkit are also on the near-term roadmap, targeting developer experience improvements and positioning TON within the AI-driven dApp development narrative.

For traders, the key variables to monitor in this environment are whether Telegram's direct involvement translates into measurable on-chain user growth  the network's TVL declined from nearly $1 billion during the 2024 peak to approximately $156 million at the time of the Tolk launch, reflecting post-airdrop user attrition  and whether the monthly token unlocks from the Believers Fund create sustained sell pressure that offsets the institutional demand narrative. The support zone at $2.20–$2.30 has been identified by multiple technical analysts as the key defense level, with $1.90 as the deeper invalidation point if bullish momentum falters. On the upside, a return to the $3 range and ultimately the ATH zone above $8 depends entirely on whether Telegram's billion-user distribution advantage converts into genuine ecosystem adoption at a scale that prior airdrop-driven metrics did not sustain. BYDFi supports TON/USDT spot trading, providing liquid access to TON across market conditions.

FAQs

Q1. What is the TON Foundation and how is it related to Telegram?
The TON Foundation is a Swiss nonprofit that governs The Open Network blockchain  originally developed by Telegram but abandoned in 2020 after SEC regulatory action. The foundation was established by independent community developers who continued building on the open-source codebase. In 2025, Telegram's founder Pavel Durov announced Telegram is taking direct operational control of the network, becoming its largest validator and primary development driver.

Q2. What was the purpose of TON Foundation's $400 million capital raise in 2025?
The raise was structured as a secondary purchase of Toncoin from early investors  not a new equity round  with participation from Sequoia Capital, Benchmark, Ribbit, Kingsway Capital, Draper Associates, and others. The capital consolidated institutional ownership in TON and accompanied plans to launch a publicly traded crypto treasury company focused on holding Toncoin, following a structure similar to the MicroStrategy model applied to Bitcoin.

Q3. What is Tolk 1.0 and why does it matter for TON's ecosystem?
Tolk 1.0 is a native smart contract programming language launched by the TON Foundation in July 2025. It replaces FunC — a low-level, difficult language  with a more accessible syntax designed to lower the development barrier for builders on TON. The launch included full migration tooling for existing contracts, directly addressing one of the ecosystem's key structural weaknesses and expanding the developer addressable market for TON-based applications.

Q4. What are the key risks traders should consider when evaluating Toncoin?
Primary risks include sustained sell pressure from monthly token unlocks via the Believers Fund, the significant decline in TVL from peak levels signaling post-airdrop user attrition, centralization concerns from Telegram's direct governance control, and ongoing regulatory uncertainty around Telegram as an entity. The token also remains 70%+ below its 2024 ATH, meaning full recovery requires a sustained fundamental re-rating rather than simple momentum recovery.

Q5. How does Toncoin's integration with Telegram create a unique market position?
Telegram's in-app wallet enables Toncoin and USDT payments natively within the messaging interface  giving TON distribution access to hundreds of millions of users who do not need to download separate wallet apps or navigate external exchanges. The Mini Apps ecosystem allows developers to build crypto-enabled applications directly inside Telegram, creating a closed-loop economy where Toncoin functions as the native payment layer for a platform already embedded in users' daily communication habits.