What Is Toncoin and Is It Safe? Everything You Need to Know
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Although it is connected to Telegram in some way, Toncoin is not the same thing. The information that you require is detailed below.
At this point in time, it would appear that everybody wants to get in on the cryptocurrency action, whether they are entrepreneurs, developers, or well-established organizations like Telegram. This company was responsible for the launch of a cryptocurrency project, which was followed by a challenging and time-consuming journey. Toncoin, a currency that was created as a result of this trip, has been in circulation for some time, but what exactly is it used for? And most importantly, can you assure me that it is safe?
What Are Toncoin and TON?
Toncoin, also abbreviated as TON, is the network’s underlying cryptocurrency and token. An example of a decentralized layer-1 blockchain is referred to by the name TON, which stands for “The Open Network.” The term “layer-1” refers to the level of development of a blockchain and represents the primary foundation or architecture of a particular blockchain network.
It is claimed that TON is capable of supporting “billions of users” because of its scalable design and architecture. TON achieves this through a process known as blockchain sharding, which is a method that involves the use of many blockchains within the same network. Each of these blockchains serves its own purpose, such as governance, the recording of transactions, or something else entirely. The present configuration of the TON network includes master, work, and shard chains.
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This distributes the workload of the network across numerous chains and prevents any one chain from having to deal with enormous backlogs of unverified blocks by spreading the workload across multiple chains. Sharding is being used by a number of well-known blockchains, including Zilliqa, and the Ethereum network is making preparations to use this strategy in the not-too-distant future.
The proof of stake (PoS) consensus technique is employed as the transaction verification method on the TON network. Staking, also known as proof of stake, is a procedure that validators, which are also known as nodes, use to validate transactions. Proof of stake is a system that is extensively used and involves the usage of validators. Proof of stake is a more environmentally friendly and energy-efficient alternative to proof of work, which is the consensus method that Bitcoin employs. As a result, many blockchain networks have abandoned proof of work in favor of this more recent protocol.
TON’s Early Challenges
In 2018, Telegram Open Network (TON) was introduced with the goal of easing the process of making cryptocurrency payments over Telegram. However, the initiative encountered a lot of obstacles when it first got started.
The native currency of the Telegram Open Network was initially referred to as Gram when it first launched. After the initial public offering of Gram tokens had begun, the SEC took action after it became apparent that Telegram had failed to register a preliminary sale of Gram tokens worth $1.7 billion. This prompted the SEC to take action. As a consequence of this, the SEC instructed Telegram to place temporary restrictions on Gram’s sale, and Telegram ultimately ended up losing the legal lawsuit it brought regarding the unreported sale.
In addition to this problem, the debut of Telegram Open Network brought with it a surge of online attacks that were made possible by criminal actors who used Telegram’s well-known name in order to defraud unsuspecting users. Under the pretext of having some sort of relationship with Telegram, these shady characters would give away free Gram tokens. In this particular scenario, however, there were not any Gram tokens up for grabs, and Telegram made an attempt to alert users to the fact that there would not be any Gram tokens distributed as prizes.
However, his added difficulty led to the slightly tarnished reputation of the original Telegram Open Network, which in turn did not help Telegram’s image. Neither did his dilemma benefit Telegram.
After losing its legal battle with the SEC, Coin Desk reports that Telegram promised investors that they would be repaid 72% of their initial dividend in Gram tokens. However, only 70% of this amount was given to investors.
In the end, Pavel Durov, the founder of Telegram, came to the conclusion that it was time for the firm to terminate its partnership with Telegram Open Network. But this didn’t leave it dead in the water. TON was brought back to life in the year 2020 by a team of software developers who called themselves NewTON. This group carried on with the development of TON and also changed the name of the project. The Open Network is what “TON” now stands for.
This takes us to the current iteration of TON, which “boasts ultra-fast transactions, small fees, easy-to-use apps, and is ecologically friendly,” as the website puts it (as stated by TON itself). Toncoin is the name of the currency that is utilized by TON. So, let’s talk about how it operates, shall we?
How Does Toncoin Work?
It is common practice to refer to Toncoin as the native token of TON; nevertheless, Toncoin is actually a coin. This is because, unlike Ethereum, Toncoin was built from scratch rather than built on top of a chain that already existed. Instead, it uses its own blockchain (or, in this case, blockchains). Within the TON ecosystem, Toncoin can be used in a variety of different ways, all of which are detailed on the official website for the TON network. Now, let’s talk about these application questions.
To begin, the @wallet bot functionality found within the Telegram client enables users to purchase and send Toncoin. If you are interested in learning more about utilising Toncoin on Telegram, we have a post that explains how to send crypto using Telegram. You can find it here.
In addition, you can use Toncoin as a form of payment for a variety of services offered within TON, such as those made available by decentralized applications developed within the TON ecosystem. This is a common occurrence on Ethereum and other blockchains that allow for the development of decentralized applications (DApps), such as Avalanche.
Voting on TON’s future modifications and development can also be done with Toncoin, which is used within the TON governance software. Instead of having to wait for the developers of TON to make all of the decisions, users will now be able to vote on how the platform develops, giving them a voice in the process. Additionally, since TON is a proof of stake network, validator fees are also paid in Toncoin rather than other cryptocurrencies.
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Transactions conducted with Toncoin can likewise be completed at a very low cost. Transaction fees are rising across hundreds of blockchains, which is one of the most significant challenges facing the bitcoin industry. The creators of TON have taken note of this issue and constructed the network to keep transaction costs at a minimum of $0.01 or less at all times. Even trades of Toncoin incur a cost that is less than $0.05. These fees are small in comparison to the fees associated with many other blockchains, which makes the use of TON more accessible to anybody and everyone.
Toncoin’s price, like that of any cryptocurrency, is subject to extreme volatility but sits at a value of approximately $0.99 at the moment. In point of fact, despite the continued decline in the value of the cryptocurrency market up until July 2022, demand for Toncoin and its overall worth increased overall.
Is it now truly risk-free to invest in this asset that has been the subject of controversy in the past?
Is Toncoin Safe?
It is essential to first recognise that the vast majority of cryptocurrencies available on the market today represent an investment that can be considered high-risk. This is due to the fact that the cryptocurrency business as a whole is mostly unregulated, is extremely vulnerable to a wide variety of events that can trigger a crash, and is replete with frauds. Nevertheless, because context is essential, let’s find out whether investing in Toncoin is a safe bet in terms of cryptocurrencies.
There is no way to refute the fact that Toncoin is a genuine cryptocurrency serving a genuine purpose. The concepts that underpin Toncoin are clearly intriguing and have the potential to give consumers access to a variety of highly helpful products and services, as was previously said.
In this regard, TON (and by extension, Toncoin) unquestionably possesses considerable potential inside the cryptocurrency industry. Its strong foothold is due to its capacity for scaling without compromising its decentralised structure, as well as its relatively low transaction fees. Despite this, the cryptocurrency sector is in a constant state of flux, and any one of a number of reasons might influence the growth of Toncoin and make investing in it a riskier proposition.
Toncoin May Have a Promising Future
It is safe to assume that TON and Toncoin have the potential to become heavy heavyweights within the sector within the next few months or years, despite the fact that nothing can ever be guaranteed within the realm of cryptocurrencies. As time goes on, it is possible that we may see this network and its native coin appear more frequently because it is developing as a network and its feature set is expanding.