The market has overestimated Telegram's user stickiness, there are limitations in TON's programming language and Telegram's terminal market distribution, and TON's FDV is too high.
Author: Blockworks Research
Compiled by: Felix, PANews
There has been a lot of buzz recently about TON and Telegram, with many people believing that TON will be the next SOL or ETH. Blockworks Research issued an article interpreting it, believing that TON’s subsequent growth will be weak and may fail to meet expectations.
Telegram user stickiness is not high
Telegram has global influence and a considerable number of daily active users (DAU) that can divert users to TON. By this measure, Telegram is one of the most used apps in the world.
Telegram is one of the most popular apps in the world, according to data provided by Telegram. With a total of 900 million users, it ranks 8th among global apps.
However, as measured by DAU, Telegram’s user stickiness is overestimated.
The DAU/MAU ratio of each social application in the figure below shows that although Telegram’s MAU (monthly active users) is high, its DAU is relatively low (around 55 million to 200 million, which is very low compared to competing applications) , the DAU/MAU ratio is only 15%.
In comparison, Facebook’s ratio is 69%, Wechat is about 67%, Instagram is 60%, TikTok (only counting the US market) is 49%, and Twitter (X) is 45%. This suggests Telegram has lower market penetration and a smaller monetizable user base than the market expected.
PANews Note: The DAU/MAU ratio can measure network or application user stickiness
Not compatible with EVM, little programming language usage
The TON ecosystem team will face challenges from the lack of EVM compatibility and FunC (the blockchain’s native programming language).
The Ton Virtual Machine (TVM) is not compatible with the Ethereum Virtual Machine (EVM) because TON uses 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 (more than 90,000 developers participated), Rust is the most recommended language, with more than 80% of developers hoping to use it again next year. 46.4% of developers expect to use Solidity.
The three programming languages available on TON are Fift, FunC and Tact. Currently the most commonly used language among the three is FunC. Although FunC looks a lot like the C language, it is generally not known or admired.
There are limitations in end market coverage
A big part of the TON narrative growth is that Telegram will become the next WeChat. However, WeChat is blocked from the US market and only serves the Chinese market.
In sharp contrast, today's application market is dominated by technology giants with strong financial resources and complete network effects, while Telegram's largest market is located in the fragmented markets of the Asia-Pacific region (except China and Eastern Europe), which makes the use of Telegram Distribution startups add a layer of complexity.
The following is Telegram’s full-year download distribution in 2022:
India: 104 million downloads.
Russia: 34 million downloads.
Indonesia: 27 million downloads
United States: 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.
Türkiye: 9.79 million downloads.
FDV is overvalued
Despite these realities, TON still has huge growth potential, with little margin of safety for new investors.
The figure below shows that among all public chains, TON's FDV is 8.6 times the annualized DEX trading volume of its network, ranking first and at the highest level.
In addition, FDV is 927 times the annualized fee of its network, ranking high among all public chains.
Related reading: A look at 10 new interactive projects in the TON ecosystem
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This article is reprinted from PANews with permission
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