Telegram launched as a simple messaging app in 2013. Today, it’s a major player in the cryptocurrency space, integrating the TON blockchain.

When brothers Nikolai and Pavel Durov founded Telegram, the startup quickly gained popularity for its emphasis on privacy and speed.

In the subsequent years, Telegram underwent a transformation: changing from a communication tool to a key platform for crypto users and applications.

In this article, we will retrace Telegram’s journey, from its initial foray into blockchain technology with the TON Blockchain to its legal battles with the U.S. Securities and Exchange Commission and its current influential role in the crypto community.

Telegram origins and shift to crypto

As stated earlier, Telegram started as a messaging app — touted for its strong security features and user-friendly interface. It utilized encrypted chats and large group chats. 

Telegram’s introduction of bots in 2015 marked a significant milestone. This allowed the app’s users to automate tasks, manage groups, and even facilitate complex interactions.

As the platform grew, Telegram introduced voice calls in 2017 and video calls in 2020, further enhancing its communication capabilities.

Its evolution continued with the launch of channels, which provided a new way for users to broadcast messages to large audiences. This tool was further enhanced with stories for channels, a feature allowing users to share fleeting content with unique dual-camera functionality and detailed privacy settings.

It also introduced a transparent and fair giveaway system within channels, enabling users to win real-world prizes.

However, the Durov brothers had a grander vision for Telegram beyond messaging. They sought to create a decentralized platform that could change the way people handled digital transactions and communications.

This vision led to the creation of the Telegram Open Network blockchain. The goal was to build a high-performance blockchain capable of processing millions of transactions per second while integrating seamlessly with Telegram’s messaging platform.

The project promised to introduce new features such as decentralized applications, smart contracts, and a native cryptocurrency, Gram.

Developing the TON blockchain

The TON Blockchain began in earnest when Pavel Durov released a whitepaper in 2018 outlining its technological advancements and potential.

Originally envisioned to integrate cryptocurrency and blockchain features into the Telegram ecosystem, TON’s creators designed it with scalability in mind. It was meant to handle millions of transactions per second, a feat it aimed to achieve through a unique multi-blockchain architecture and sharding mechanism. 

The mechanism splits the blockchain into a master chain, which manages the overall network, and multiple work chains, each capable of operating independently.

To actualize this dream, Telegram sought to raise funds through an initial coin offering. Before that, the company raised about $1.7 billion from 175 investors in a private sale of its native Gram token.

However, the success was short-lived. Soon after the presale, the U.S. Securities and Exchange Commission cast its regulatory eyes on the platform.

Legal battle with the SEC

In October 2019, the SEC filed a complaint against Telegram, alleging that the company had conducted an unregistered securities offering by selling Gram tokens. The commission argued that those tokens were securities and should have been registered under U.S. securities laws.

The legal battle culminated in a landmark decision in March 2020 when a U.S. federal court ruled in favor of the SEC, halting the distribution of Gram tokens. 

As a result, Telegram postponed and eventually abandoned the project in May 2020. It also agreed to return the money raised in the pre-ICO event to investors and pay an $18.5 million civil penalty.

Telegram felt the impact of this decision, which also sent shockwaves through the broader crypto industry, highlighting the regulatory challenges blockchain projects face.

Once Telegram stepped back, a group of independent developers picked up the slack and continued to build TON, now renamed The Open Network. This ensured the project’s survival. 

Its development is now supported and guided by a non-profit organization, the TON Foundation, based in Zug, Switzerland. Steve Yun serves as the president of the TON Foundation, while Andrew Rogozov, former CEO of Russian social media site VK, is a founding member.

Throughout 2021 and 2022, the TON community focused on improving the network’s architecture, implementing dynamic sharding, and refining its proof-of-stake consensus mechanism.

Telegram’s continued support and integration

While no longer the architect of the development of TON, Telegram has continued to support the platform. For instance, in September 2023, the messaging app, with more than 800 million users at the time, integrated the TON Space self-custodial wallet. 

This integration was followed by an introduction to an ad revenue-sharing system this past March, where payments are made exclusively in Toncoin (TON), the successor of Gram, thereby fostering further engagement with the TON ecosystem.

In September 2023, Telegram officially endorsed TON, declaring the blockchain and its associated token as the app’s “official web3 infrastructure.” This move has sparked investor interest and led to substantial gains for the TON token.

As a result, the total value locked on TON surpassed $300 million on May 27, 2024, marking a significant milestone fueled by a community rewards program from the TON Foundation.

Telegram’s current role in crypto

Seemingly putting its disappointment at not being able to build the TON network by itself, Telegram has continued to play a pivotal role in the crypto space. The messaging app has become a central hub for the crypto community, providing a platform for discussion, collaboration, and information sharing. 

Telegram groups and channels are widely used for announcements, trading signals, and community building within the crypto ecosystem.

Additionally, the platform’s influence in the crypto space has been further solidified by its recent introduction of new features that cater to crypto users, such as a digital marketplace within the app and integrations with popular wallets like Trust Wallet.

Telegram’s collaboration with Trust Wallet will enable the crypto wallet to leverage the messaging app’s vast user base, focusing on gaming finance and dapps. It will also reportedly allow Trust Wallet’s 100 million users to send and receive TON tokens.

Furthermore, TON announced it would soon support Tether (USDT) tokens on its blockchain, allowing Telegram users to send the stablecoin within the app. 

News of that particular development boosted TON’s value, pushing it up to $7.63 on April 11 from approximately $2.21 a year ago, according to CoinGecko data. 

At the time of this writing, a TON token was going for $5.46, giving the cryptocurrency an overall value of $13.7 billion and making it the tenth-biggest digital asset by market cap, just behind Dogecoin (DOGE).

Rise of mini-apps and the tap-to-play ecosystem

On July 31, Telegram announced it was rolling out a new in-app browser, expanding its blockchain capabilities and user experience. The announcement followed the introduction of a mini app store earlier in the month by CEO Pavel Durov.

This new browser will enable Telegram’s vast user base to access TON sites, a platform for decentralized websites. The Telegram co-founder highlighted that the browser offers features akin to traditional web browsers and integrates web browsing with messaging.

Additionally, you can access the Telegram mini app store through the app’s search feature. According to the announcement, 500 million of Telegram’s 950 million users interact with mini-apps monthly, and they can now find all their mini-apps in one consolidated location. 

The ecosystem also introduces “Stars,” a new in-app payment unit launched on June 7. Users can send Stars to friends and use them for transactions within mini-apps, which can later be exchanged for Toncoin.

Telegram’s mini-apps have been quite successful. Popular applications like Notcoin (NOT) and Hamster Kombat attract millions of users worldwide. In Notcoin, users earn tokens by completing social challenges. The game has amassed more than 35 million users in five months and had a $1.15 billion market cap at the time of writing.

Hamster Kombat, a crypto exchange management simulation game, is no slouch either. It has become one of the fastest-growing web3 applications, reportedly boasting over 300 million users since its launch in March 2024. 

The project plans to launch a significant airdrop for its native token, HMSTR, on the TON network, an exercise it described as the “largest airdrop in the history of crypto.” 

As reported by crypto.news, Hamster Kombat plans to distribute at least 60% of the HMSTR supply to players of the game on Telegram.

With both Catizen and Hamster Kombat missing their airdrop deadlines, what are the underlying issues causing these delays?

Lately, there’s been a lot of buzz in the Telegram gaming community about two highly anticipated token airdrops: CATI from the puzzle game Catizen and HMSTR from the viral tap-to-earn game (T2E) Hamster Kombat. 

Both were set to launch their tokens on The Open Network (TON) in July. As the end of the month approaches, neither has delivered on their promises, causing frustration among eager players.

Catizen’s creators, Pluto Studio, have openly addressed the delay, citing planning challenges. 

Similarly, the Hamster Kombat team has hinted through social media that their token release might not happen this month either, despite their website still listing July as the target date.

Let’s understand what has happened and why there are delays.

Why Catizen’s airdrop is on pause

Catizen is a web3 social entertainment platform on Telegram, aiming to create a decentralized app that integrates mini-games, short dramas, and e-commerce. 

Catizen boasts over 27 million active users worldwide and has handled more than 20 million on-chain transactions to date.

In addition to this success, Telegram founder Pavel Durov recently mentioned that Catizen earned $16 million from in-game purchases. Impressively, they also donated 1% of this amount to save homeless cats.

The planned airdrop of CATI tokens, which involves distributing 43% of all CATI tokens using the TON blockchain, was eagerly awaited by the Catizen community. However, the giveaway has been postponed.

According to Pluto Studio, the developer behind Catizen, several challenges have arisen during the planning stages. They cited the need to optimize key elements like securing leading exchanges, ensuring sufficient liquidity, and determining the listing price. Compliance and market sentiment have also played a role in this delay.

Pluto Studio also revealed that seed round investors, advisors, and the team will receive 0% of the CATI tokens at the token generation event (TGE). Instead, there will be a 12-month cliff period followed by a 4-year vesting schedule. This strategy is designed to align the interests of the developers and the community, ensuring the long-term value of the CATI token.

The team at Catizen has asked for patience and understanding from their community, promising that they are doing everything possible to deliver the anticipated results.

Besides the delay in launching their token, Pluto Studio has also faced player frustration due to a $100,000 donation they made to the animal rights nonprofit People for the Ethical Treatment of Animals (PETA) earlier this month. 

This donation was part of an effort to share a portion of the game’s profits with charities helping stray cats. However, PETA’s controversial history of euthanizing animals that they deem beyond help has caused a backlash. 

On July 29, Pluto tweeted that they had ‘received feedback’ about PETA’s practices and had ‘temporarily suspended’ the collaboration. They clarified that all Catizen donations to PETA would be used solely for feeding, vaccination, rescue, and adoption assistance.

Meanwhile, Bybit, the world’s second-largest cryptocurrency exchange by trading volume, has announced that it will list the CATI token on its pre-market trading platform on July 30.

Hamster Kombat’s airdrop delay

Hamster Kombat is a popular game built within the messaging platform Telegram. In Hamster Kombat, players act as the hamster CEO of a fictional crypto exchange, aiming to boost their startup to the top of the industry by investing in marketing, licenses, talent, new products, and more.

In just a few months, Hamster Kombat has amassed over 250 million players, making it a key player in the Telegram gaming community, although it has drawn criticism from government officials along the way.

In May, Hamster Kombat announced via Twitter their decision to launch their token, HMSTR, on the TON blockchain. Their website still indicates a July date for the TGE. However, as July comes to an end, the token has yet to be launched.

Recently, Hamster Kombat addressed the community through another tweet, explaining the situation. They highlighted the complexity of the technical task involved in the airdrop, considering the scale of Hamster Kombat as one of the biggest projects in the industry, which could result in the largest airdrop in history.

They assured players that they are actively working to make the airdrop happen smoothly, addressing potential network overload issues to ensure that every player receives their tokens.

The rise of Telegram-based crypto games in 2024

The year 2024 has been incredibly favorable for Telegram-based crypto games, which have seen heightened interest and massive user growth. 

Leading the way is Notcoin (NOT), a game launched by Open Builders in early 2024. Notcoin’s success lies in its simple and engaging T2E mechanism, allowing users to earn cryptocurrency with ease.

Notcoin’s straightforward play model quickly gained popularity, propelling it into the top 100 coins by market cap. As of July 30, it ranks 63rd with a market cap of over $1.3 billion.

The success of Notcoin has also paved the way for other Telegram-based games like Hamster Kombat and Catizen, leveraging the popularity of the TON blockchain. 

Other projects, such as YesCoin (YES) and TapSwap (TAPS), have also seen a surge in usage and popularity, contributing to the overall trend.

The current trend of heightened interest in Telegram-based crypto games suggests that the road is set for Hamster Kombat and Catizen to launch their airdrops successfully.