After Trump's victory, Bitcoin broke through 76,000, and the bullish pattern is prevailing. However, compared to Bitcoin's price fluctuations, the most beneficial thing for the entire industry ecosystem's growth is the altcoin season, and the industry is looking forward to richer growth. In the short term, we can see that tokens across different sectors are already closely following the market trend and reigniting enthusiasm. Among these sectors closely following the market, the 'TON ecosystem' is still under tight observation from investors.

Since the Durov Paris incident two months ago, the TON ecosystem has fallen into crisis or entered a new adjustment phase. Even though various meme projects and mini games within the ecosystem continue to attract new users and regularly update activity information, market-sensitive individuals seem to have sensed the 'faith constraints' in the TON ecosystem.

For instance, from market feedback, SOL has quickly rebounded and broken through 200 following BTC, but TON's growth has not matched this.

So for TON, what is the most favorable aspect in this highly watched industry election event? We can find some answers among Trump's ten commitments to cryptocurrency. In these commitments, we see measures not only for Bitcoin, but more initiatives represent a 'de-restriction' of the US dollar economy towards the cryptocurrency industry. For Telegram and TON, which have long been in the fog, this will be a strong medicine.

Under the expectation of a smooth background, if the market continues to rise, what specific development expectations can we have for TON?

Favorable development background for TON

Before the Durov incident, the growth of the TON ecosystem was strong. Led by the severalfold increase in TON tokens, most ecological DeFi tokens grew by about 10 times. Besides the token price increase, the attention was even more outstanding: first, various CEXs competed to list Notcoin before its launch to attract new TON ecological users, and then DOGS once again ignited the enthusiasm of all Telegram users. This represents a massive market base, and as long as the market rebounds, the rebound of TON ecological tokens will inevitably follow.

However, in the past two months of stagnation, following the decline of TON tokens, the TVL, DEX trading volume, and other metrics within the ecosystem have also decreased alongside the reduced heat. This is the most thought-provoking data at present.

However, when we understand TON from the perspective of long-term growth of public chains, we may discover that the current data performance is an inevitable occurrence during the growth process of public chains. This firstly allows us not to worry about the future competition among public chains losing TON's position but rather to continue viewing TON with a long-term perspective.

Just as the trend of DEX development indicates, the entire industry's user education is paving the way for high-speed public chains like TON.

On October 28, according to SolanaFloor, the trading volume of Solana DEX reached $15.78 billion within the week, surpassing Ethereum's $8.87 billion by 77.91%, achieving the largest lead over Ethereum in history. Consequently, Solana's share of total DEX trading volume reached 35%, marking a historical high.

Meanwhile, according to data from The Block and DefiLlama, the spot trading volume of DEXs relative to CEXs reached 14.12% in October, setting a new high since May 2023.

This trend continually confirms one trend: as high-speed chains become popular, the boundary between user trading behaviors in DEX and CEX is becoming increasingly blurred.

In the face of multiple trends in the industry regarding the maturity of on-chain liquidity supply, on-chain token market value management, and the prevalence of small and medium-sized projects, under comprehensive conditions such as the increasingly blurred trading scenarios for user transactions, ultimately we will see user behavior turning into: more trading actions and interactive behaviors returning to on-chain native trading exchanges, or primarily DEX and Web3-style interactive trading behaviors.

In contrast to the current background infrastructure hotspots across various chains, TON itself represents an ecosystem where the boundaries between DEX and CEX are becoming increasingly blurred. Its Web2 interaction method first blurs trading categories, and the TON wallet on Telegram further lowers the threshold for entering native Web3 transactions, meaning simpler and more convenient on-chain native trading, or it may even surpass the convenience of trading achieved on Solana.

We can imagine that under the environment of Solana, excellent DEXs can achieve explosive trading volume in a short time. For example, Dune data shows that the total trading volume of Solana's DEX aggregator Jupiter is close to 334 billion USD, while Uniswap spent several times the time taken by Jupiter to reach 10 billion USD.

Moreover, recently the token price of Raydium, the most active DEX on Solana, has performed extraordinarily. Despite the corrections in BTC, ETH, and most altcoins, it still maintains an upward trend in price, fully demonstrating the stable advantages that DEX and DeFi can possess amidst price fluctuations.

Such a development path has already equipped TON with the necessary infrastructure and development thinking, just lacking a spark.

The growth history of public chains

TON has already been very impressive in the early stages of this cycle. However, in today's unclear cycle rotation, it is difficult for TON to have the previous time advantage and external momentum like Ethereum and Solana. Seeking stability, maintaining infrastructure perfection, and waiting for opportunities to explode still seem to be the main theme for TON, as if TON has quietly prepared for a year for the cycle development in 2024. By tracing the growth of Ethereum and Solana, we can find a clear development path for TON.

Firstly, the economic model of public chains wants to enter a positive cycle; the core lies in the continuous occurrence of transactions, representing all possible on-chain interactive behaviors.

On Ethereum and Solana, the actions of DEXs and DeFi dominate, driven by users utilizing DApps. Therefore, bringing rich and diversified application types for the ecosystem's development thinking is suitable for TON.

In summary, both Ethereum and Solana have gone through these steps:

1. Rapid increase in the number of TGE tokens for ecological projects

In simple terms, it means that during favorable cycles, a large number of ecological projects issue tokens and launch on DEXs, or DeFi can initiate business.

Ethereum began this phase in 2018 and completely formed a wave before DeFi Summer, which included the emergence of Uniswap, various wallet applications, major EVM projects, DEXs, and DeFi issuing tokens successively to stimulate business growth.

Solana emerged as a challenger to Ethereum during DeFi Summer, with the foundation driving a large number of TGE projects. Even though the chain was not perfect and on-chain interactions were limited, Solana's stimulation of the ecosystem has been continuous, and the impact of the SBF incident has not completely halted.

At the start of this cycle for TON, the volume of tokens within the ecosystem surged, and the popularity and price increase of tokens were also impressive, much like the corresponding phases for Ethereum and Solana.

2. Growth of DeFi TVL

The most direct impact following the TGE of numerous ecological project tokens is TVL. Native applications of public chains are all related to token trading, and DeFi categories account for 90%. Token listings on DEXs and the initiation of DeFi businesses will lead to lock-ups, so TVL data is the second inevitable metric for the growth of public chains.

Every token launched on a DEX must add a trading pool, which often constitutes the first locked capital. If engaging in DeFi business interactions, such as lending and depositing coins, token staking will inevitably occur, which is the second foundational action for TVL growth. Stimuli for this action will include token airdrops, mining, and earning interest through lending and depositing coins.

Ethereum, during DeFi Summer, received a dual stimulus from TGE and the explosive growth of DeFi tokens, with TVL increasing nearly 100 times. Later, as prices rose, TVL surged again. This growth for Solana came from the ecological heat of 2023 and the airdrops, TGEs, etc., of ecological projects in 2024.

In the past six months, TON's TVL rose to 700 million USD but started to decline before breaking through 800 million USD, a result of the ecosystem's heat withdrawal. Similar to Ethereum and Solana, after the first growth, it needs to return to the richness of ecological application projects. Ethereum and Solana both took another two years; how long will it take for TON?

3. Accumulation of richness in DEX and DeFi

Ethereum and Solana completed a two-year accumulation of richness, one during the bear market of 2018, and the other after the heat withdrawal of DeFi Summer.

At this stage, Uniswap V1 matured on Ethereum, MakerDAO and AAVE emerged, Curve and Compound began, and Sushiswap quickly followed suit, with farm-type mining projects appearing one after another. All these projects contributed to the maturity of DEXs and DeFi. By the time of the second round of application development, DEXs like Uniswap had iterated at least two versions, and DeFi like AAVE expanded from single-chain to almost all EVM-compatible chains.

During Solana's accumulation process, DEXs like Raydium and Jupiter emerged, along with a large amount of SOL token staking DeFi. Therefore, the maturity of these applications is necessary, representing a more convenient and faster way for users to utilize services, effectively locking users' real money on the public chain.

TON is still early in its maturity; currently, DEX functionalities are relatively singular with few DeFi offerings. The first step before waiting for an explosive opportunity is to increase the diversity and maturity of DeFi.

The first step of TON's growth

In the past year, TON experienced the first growth in the quantity of ecological project tokens, with a large number of tokens and small-medium projects starting to list, airdrop, and conduct IEOs. Subsequently, TVL grew rapidly, but this time, following the decline in TVL and prices, the heat has diminished, and ecological projects will be affected as well, necessitating a rebuilding of trust in the future. The more urgent it is now, the more practical help is needed in this round to ensure the diversification of the ecosystem, which calls for the maturity of DEXs and DeFi.

In reality, TON is also at this stage, which is the first step of TON's growth.

What we can see is that DEXs on Ethereum and Solana have matured significantly through cycles. So, how does TON currently compare? How far apart are they, and where do the gaps lie?

TON's performance and pressure-bearing capacity are currently the only ones that can stand alongside Solana among all public chains, but the DEX of the TON ecosystem cannot match its potential.

Telegram has integrated a centralized trading pool to complete the recharge of stablecoins and TON, subsequently completing the exchange of TON and other tokens, with an operational experience consistent with CEX's flash exchange. This function is the primary feature of Telegram's Wallet, while the second feature is to interact with the on-chain through the TON public chain wallet TONSpace, providing a basic experience similar to using MetaMask on PC and mobile. For token exchanges, STON and Dedust are relatively commonly used within the ecosystem, but their functionalities are basically similar to Uniswap V1.

This reflects the shortcomings of TON in terms of DEX. If Telegram Wallet embodies the CEX experience, TONSpace and DEX can interact on PC and mobile. Telegram's MiniApp and Bot will also serve as the front end for DEX or CEX functionalities. These designs meet the optimization of trading experiences, but the native interaction on the backend chain is clearly lagging behind.

If DEX on Solana and Ethereum can only provide simple AMM pools and exchange capabilities similar to Uniswap V1, then the richness of DeFi on Ethereum and the business richness on Solana would decrease by at least 50%.

On Ethereum, most DeFi extends financial scenarios beyond DEX functionalities. After Uniswap's initial iteration of the LP design in AMM, Ethereum's DeFi saw more new business or directly replicated business models (based on liquidity mining, interest-bearing deposits, upgraded to multi-liquidity pool interactions, etc.). Solana is similar; in DEXs, LPs and specialized liquidity platforms serve as one of the best options for asset holders.

Therefore, from the perspective of project development, it is important for DEXs on high-speed blockchains to provide trading liquidity or modularize trading functionalities so that the advantages of liquidity become the reason for users' choice.

In terms of trading on TON, its front-end access must largely exist within Telegram. DEX still needs to increase the refinement of its business like Jupiter, Balancer, etc., to achieve a balance among all users, whether they are users, token providers, liquidity providers, or platform developers, each role requires certain refined functions to cooperate.

Compared to DEXs like Uniswap, Balancer, and Jupiter, the DEXs on TON have already become an inevitable development path in terms of supplementing DEX functionalities or DeFi functionalities.

The known project LayerPixel has already launched the first step of DEX functionality repairs, PixelSwap, based on Balancer's capabilities. For DEX, airdrops are the quickest action to attract users. In the new round of actions, LayerPixel has announced that PixelSwap has already started an airdrop plan, with the confirmed token PIX's TGE date set for Q4. In light of the current changes in the TON ecosystem, PixelSwap may still be able to stabilize progress like Raydium in the short term.

LayerPixel is a DeFi solution designed for Telegram Mini Apps, enabling seamless integration between DeFi and Telegram Mini Apps. Officially, it is referred to as TON's Layer 1.5. It offers a modular combination of functionalities including wallet, DEX (various trading algorithms), oracles, etc. PixelWallet focuses on account abstraction, while Pixacle provides fast and accurate price data for DApps and smart contracts within the ecosystem.

Pixelswap is a DEX based on weighted pools, consistent with Balancer's functionalities, supporting the asset issuance method of LBP. This type of Dutch auction issuance method is suitable for small and medium-sized projects with low FDV, and the most prevalent projects in the Telegram ecosystem are such game/GameFi projects. This is why it can meet the DeFi needs of the TON ecosystem; the LBP asset issuance method facilitates small and medium-sized projects to complete token issuance in the early stages and maintain a relatively reasonable trading price.

During the rapid development and growth phase, ordinary DEXs are mainstream, but once entering a downward trend, the token prices within DEXs become harder to market compared to CEXs. At this time, the more refined the design, the more it can achieve a win-win situation. For B-end, it is more suitable for control; for C-end, it allows unofficial LPs in DEXs to resemble the matured LPs in centralized exchanges, actively ensuring the yield of funds while isolating risks and stabilizing prices.

At this point in time, in the phase of growth appearing to pull back, the emergence of this type of DEX is quite appropriate.

Beyond PixelSwap, the liquidity sharing between DEXs on TON and the possible liquidity hedging structure among various DeFi projects also need stability. Currently, after projects issue tokens, they cannot establish staking mining or multi-type deposit financial products in most DeFi.

One of the reasons for the rapid increase in token lock-up volume on Solana is that lending projects, stake, and restake projects are all following hot projects, such as Marginfi and Meteora on Solana, which proactively increased the token pools for newly emerging tokens on Solana. Although most tokens do not yield financial returns, platforms provide incentives like points or airdrop expectations, encouraging investors to deposit large amounts of assets to bet on airdrop expectations. If TON follows suit, it would have the same effect.

Final thoughts

Before the Durov incident, our expectations for TON were very high, but the decline in the ecosystem's heat has left both ecosystem projects and investors in pain. This is a rhythm familiar to the industry; some investors' persistence in projects is surprisingly long. Regardless of when the next ignition opportunity may occur, whether in a week or several months, it provides builders with ample time to enrich the ecosystem.

In this current stage of TON, users and projects will gradually realize the differences in new DEXs and new functionalities, or they may one day discover that new DEXs like PixelSwap have attracted a large amount of TVL and established multiple staking pools, indicating that the ecosystem is ready for another growth phase, prepared to cope with the continuously increasing trading volume, newly issued projects, and rapidly increasing liquidity pools and liquidity mining.