This week’s market situation remains lackluster. In this issue of CryptoSnap, we will continue to discuss the development of the Ton ecosystem. Dr. DODO will introduce the current status of Ton Defi’s development and future directions for improvement. We will also discuss which areas of development retail investors need to pay attention to.
Ton Defi Current Status
Although Defi is not the main focus in this cycle, its development is still a major indicator of the vitality of any public chain’s ecosystem. Ton is no exception. As mentioned in the previous issue of Cryptosnap, the basic Defi applications on the Ton blockchain, such as DEX, lending, and liquidity staking, have already been established, meeting the basic needs of most retail investors. However, there are still many shortcomings for high-end Defi players and whale farmers. Here are the top five important points that the Ton ecosystem needs to continue developing:
1. Introduction of mainstream assets BTC and ETH
2. More cross-chain bridge support
3. Oracle
4. Layer 2 Defi yield protocols
5. Memecoin infrastructure
Among these, the first two points are the basic support for cross-chain bridges and other major assets. The support of native USDT was the biggest catalyst for the explosive growth of TVL on the Ton blockchain from 100M to 700M in the process from 2024 Q2. I believe that in order to break through the 1B TVL mark in the next stage, it is crucial to support other mainstream assets such as BTC and ETH, and to provide more liquidity through third-party bridges. This is also the development goal for the next quarter according to the Ton Foundation’s roadmap.
Source: https://ton.org/en/roadmap
The third point, the oracle, is crucial for determining whether more complex Defi protocols can be implemented and is also a key factor for many large investors to decide whether to participate in projects. Currently, the mainstream oracle in the Ton ecosystem is Redstone, which provides price quoting functionality. However, Redstone still lacks sufficient trust among many whale players. Introducing oracles with strong capital support, such as Chainlink or Pyth, is crucial for TVL to reach new heights.
The fourth point mentioned is the Layer 2 Defi yield protocols. As I mentioned earlier, the Ton ecosystem already has the first layer of Defi Lego protocols, but there are still few second-layer Defi Lego yield projects that focus on APR yields, such as stablecoin collateralization, packaged interest-bearing assets, and yield farming strategies.
The last point I believe is the trend of this cycle: the mainstreaming of Memecoins. I believe the most successful ecosystem in this cycle, Solana, was not driven by Defi applications, but rather by the booming development of Memecoins, which led to the growth of TVL in DEX. Therefore, MemeFi is a key point that I believe should be vigorously developed. Although many teams are already working in this direction, such as TON Raffles, Ton UP, and Thunder Finance, I believe that the promotion of Memecoins requires the official collaboration with venture capital to ignite the spark, just like Solana’s $BONK and $WIF. Only with the wealth effect can we ignite the subsequent MemeFi ecosystem.
Mini APP
The biggest feature of the Ton ecosystem, in my opinion, is the Telegram Mini APP. Although most Ton Mini APPs are currently gaming projects, the mainstream Defi applications on Ton also have two front-end interfaces: one is the regular web-based Dapp, and the other is the Telegram Mini APP. I believe that the development of Telegram Mini APP effectively bridges the gap between TON’s DeFi services and Telegram users, capturing more new users on mobile devices.
However, on the other hand, complex Defi applications are not suitable for mobile devices in terms of user experience and security. Mini APPs or Telegram Chatbots are more suitable for time-sensitive Memecoin fields. Perhaps we need to wait for the appearance of the “golden dog” on Ton to drive a large number of players to become new users of Mini APPs.
Source: https://t.me/dedustBot
Source: https://t.me/StormTradeBot
The Open League Season 5
Lastly, let’s talk about the recently started competition, The Open League Season 5. Honestly, I am a bit disappointed with the current Ton Defi projects. There are only six participating protocols, and they are exactly the same as the ones in the fourth season. There are no new projects joining. As for existing projects, only the NFT lending protocol DAOLama’s token $LLAMA made it into the top ten.
Currently, the rankings are as follows: Storm Trade, a derivative perpetual contract protocol, which ranked third in the previous season, is currently in the first place with significant growth in TVL. Tradoor, also a derivative perpetual contract protocol, is not progressing and has fallen behind. The second place goes to EVAA, a lending protocol, and the third place is occupied by the NFT lending protocol DAOLama. The fourth and fifth places are taken by two major DEX protocols, DeDust and Ston.Fi.
Source: https://ton.org/open-league
Source: https://ton.org/open-league
Author’s Opinion
This article focuses on the development of Ton’s Defi. I believe that Defi still has a lot of room for development. One of the problems may be related to the fact that Ton’s development code is in a completely new language, which increases the development barrier. Currently, we have not seen strong support from venture capital, such as Multicoin and Jump Crypto’s relationship with Solana, nor have we seen representative developers emerge, such as AC’s role in the Ethereum Defi ecosystem. Of course, it is still too early to draw conclusions, and Ton’s Defi development is still worth continuous attention.
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