Telegram Is Crypto’s Adoption Machine

Telegram is onboarding the masses and ushering in a new era for public blockchains, says David Zimmerman, a research analyst at K33 Research.

AccessTimeIconJun 20, 2024 at 2:02 p.m. UTC

Listen to any crypto podcast or convention panel, and you will hear crypto natives speak of a killer app yet to come that will onboard the rest of the world. But what if it is already here? I argue that Telegram and a handful of independent developers have made more progress in onboarding the masses to crypto than the $100 billion in venture capital that has flooded the space since 2014.

Crypto adoption has been hindered by (i) poor UX, (ii) limited real-world utility, and (iii) terrible distribution. Through its support for and integration of The Open Network (TON), Telegram is addressing all of these issues and more.

From a Crypto Enthusiast’s Perspective

Throughout its early development and up until recently, crypto focused on niche tech development that primarily served crypto speculators and lacked real-world utility. With the arrival of spot ETFs and firms such as BlackRock opening up funds focused on asset tokenization, the time for evolution is now.

Telegram combined its messaging app boasting 800 million monthly active users, a blockchain providing rails for crypto adoption in TON, and a native wallet bot known simply as Wallet. Many crypto pitch decks vaguely romanticize the notion of “merging Web2 and Web3,” Telegram is actually doing it.

With this combination, Telegram addresses the three core issues that held crypto back. In my view, stablecoins are crypto’s greatest product to date. With native USDT on TON since April, the seamless transfer of value P2P became a reality. Users can send crypto to their friends as easily as sending a message on WhatsApp. This is a smoother UX than neobanks like Venmo or Revolut, and lightyears ahead of traditional banks.

The opportunity for onboarding 100s of millions to crypto, however, likely comes through Telegram’s Mini Apps an open platform for businesses to build and deploy crypto-friendly apps. This will enable crypto teams to distribute their product to non-crypto-natives while the end user will not necessarily know they are using a crypto product whether that is a fun mobile game or a DeFi protocol.

From a Crypto Native’s Perspective

Telegram solidified its place in crypto long ago. It is a popular platform among crypto natives used to keep in touch or share ideas, and it is usually the first social media channel new crypto projects set up along with their X account.

Recently, it became more than that for on-chain traders. A new generation of Telegram trading bots changed crypto UX forever, and perhaps changed on-chain trading forever. Buying/selling, setting limit orders, scanning new projects, sniping new launches, and copy trading “smart money,” all became simple with a single command.

Having a Telegram bot comprehensively freeing me from the most frustrating UX issues of on-chain trading was a breath of fresh air. It was one of the very rare times a crypto product made me say “wow, this is great.” It did, however, make altcoin trading much more competitive and spurred on what I consider the “proliferation of altcoins.”

Does this mean altcoin trading/investing is dead? Far from it. The ease with which newcomers can now interact with smart contracts compared with what I had to do starting out is night-and-day. This, combined with distribution and increasingly useful apps means a new wave of capital flowing into crypto over the coming years.

Exciting, But There Remains Work To Be Done

The improvement we have here in UX cannot be overstated. I say this because I have myself onboarded non-crypto friends through TON's Wallet. Prior to Telegram’s current infrastructure, I would let out a small sigh at the prospect of trying to teach a friend how to use crypto. Now, thanks to Telegram, I do not see how it could be easier.

So that’s it, Telegram and TON have won, right? Not quite. The improvement in UX and distribution is a big leap forward, but we have yet to see a comprehensive range of consumer-facing apps. Mini apps are being developed and there is a major incentive for game devs to build a fun Telegram game that captures the attention of its huge user base. Alas, what exists now is more meme-based than utility-based. Regulations also remain a concern, but that is an ongoing industry-wide issue not isolated to Telegram or TON.

Telegram and TON have a lot to do, but I believe they will pull it off. The market seems to be pricing this in now, as $TON has already reached the top-10 crypto list in market cap. $TON’s run has largely been fueled by fervent speculation we are so familiar with, but there are real fundamentals to back up a lot of its growth.

Most of us want to see a future where crypto is being used by the masses. This sentiment is shared by Telegram’s co-founder and CEO Pavel Durov, who is a major Bitcoin advocate. TON’s mission statement is to “put crypto in every pocket.” Simply put, Telegram is better positioned to make that happen than any other entity in our growing industry.

Note: The views expressed in this column are those of the author and do not necessarily reflect those of CoinDesk, Inc. or its owners and affiliates.

Edited by Benjamin Schiller.


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David Zimmerman

David Zimmerman is a research analyst at K33 Research.

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