The State of TON DeFi Q1 2024
Disclaimer: The tokens, exchanges, and yield instruments mentioned in this article are provided for informational purposes only and should not be interpreted as endorsements or investment advice. Readers are strongly advised to conduct their own thorough research before deciding to interact with, invest in, or participate in any transactions involving the mentioned tokens or yield instruments.
This public article is the result of an internal report conducted by The Open Platform.
As always, we continue to highlight key developments within each DeFi segment, unveil new projects, and outline the trajectory of TON’s DeFi ecosystem.
7-Fold TVL Growth Marks Q1 2024
The memecoin hype was a central theme in the TON DeFi space and the general crypto landscape in Q1 2024, which is at least partially responsible for the surging on-chain activity and DeFi metrics:
One of the main highlights of the quarter is the 7-fold increase in TVL, mainly fueled by the increased activity on DEXs and the market dominance of Tonstakers, the liquid staking protocol.
Another key theme is the launch of The Open League. This program rewards users for interacting with TON projects and features a competition with a Toncoin prize pool that rewards TON-based projects with the strongest performance during each season. The key element of the program is the farming pools with boosted APYs. The introduction of the farming pools, along with surging memecoin trading volumes, contributed to DEXs being the best-performing DeFI segment on TON based on TVL performance:
In the following section, we will explore the patterns behind the surging performance of TON-based DEXs in more detail.
DEXs: The Open League Meets the Memecoin Hype
Tokens on TON blockchain, also known as jettons, saw a dramatic surge in popularity in the last quarter of 2023, which continues to this day. Memecoins largely fueled the increase in trading activity.
The rally was chronologically preceded by the launch of Notcoin, a previously untradable memecoin that could be ‘mined’ by anyone by clicking a button in the Notcoin mini app on Telegram. Within just a few months of its launch, Notcoin attracted 35 million active users. Now listed on multiple DEXs and CEXs, Notcoin has inspired a variety of meme jettons with similar mechanics. This proliferation of jettons was one of the major drivers of the spike in trading volume on TON-based DEXs.
The memecoin hype attracted a lot of attention to DeDust and STON.fi, two DEXs that listed a substantial share of these tokens. According to data from Tonalytica, the total trading volume on DEXs on TON reached $4.2 million at the 90-day all-time-high. The all-time high was renewed in Q2 and now exceeds $60 million:
Below is the screenshot from our internal analytical tool displaying the trading volume on both DEXs. The pattern closely aligns with the one on Tonalytica’s chart:
STON.fi and DeDust act as the main venues for the boosted liquidity pools, an incentive initiative of The Open League. This resulted in more than a 9X increase in TVL on TON with a significant contribution from both DEXs over the course of the program’s first three seasons. With Season Three already in progress, readers can check the available boosted pools at STON.fi and DeDust and visit The Open League Pools bot.
STON.fi ranked first in the DeFi competition held as part of The Open League’s Pilot Season, followed by DeDust. The ranking was based on the change in TVL and the protocol fees earned during the Pilot Season. The final rankings can be accessed here.
One of the themes of Q1 2024 was the introduction of Telegram Mini Apps by both major DEXs. DeDust and STON.fi now have their own Mini Apps, which will make the trading experience more versatile and allow users to execute trades right in Telegram. This may be particularly convenient for traders who use Telegram-based token research tools and news channels.
Additionally, Storm Trade, currently the main derivative exchange on TON, now allows traders to use Toncoin as collateral for trading futures. This update eliminates the necessity of converting TON to jUSDT to place collateral, simplifying the user onboarding process and assigning Toncoin additional utility in the ecosystem. Additionally, Storm Trade completed its largest rewards program ever with a prize pool of approximately $130,000 as part of The Open League. The rewards are distributed to top performers in trading volume, PnL rankings, and liquidity provided in designated pairs.
Liquid Staking Propels TON into the Top 20 Chains by TVL
Liquid staking remains the dominant sector by TVL in TON. According to DefiLlama, TON ranks 17th by TVL as of this report, when accounting for Staking and Liquid Staking values.
Tonstakers won the liquid staking competition of The Open League’s Pilot Season, followed by bemo and the new liquid staking protocol Stakee, and remains a leader by TVL market dominance. Similar to the DeFi competition, the ranking was based on the change in TVL; another metric used was the number of new users who joined the protocol during the respective period.
Stakee (Stakee Bot) is a new liquid staking protocol on TON. Stakee blends simplicity, reliability, and high APYs to attract Toncoin holders seeking enhanced gains with minimal fees. The platform ensures secure and transparent transactions by operating on official smart contracts developed by TON Foundation.
Additionally, TON Whales launched Whale Liquid, a new liquid staking pool. The protocol allows Toncoin holders to earn wsTON, which can be swapped on DeDust, and lending protocols on TON. The project is currently in beta with a total stake of 848K Toncoin (over $5M).
Lending: EVAA Protocol Goes Live on TON
Evaa Protocol went live on TON Mainnet. As of this report, Evaa features $26.10 million in total supply and $12.03 million in total borrow.
EVAA Protocol held a Supply & Borrow campaign as part of The Open League. The campaign offered a unique opportunity for users to lend or borrow tokens such as TON, stTON, tsTON, jUSDC, and jUSDT via the EvaaAppBot or on app.evaa.finance. The participants earned weekly airdrops, interest rewards for supplying and borrowing activities, and EVAA XP points, which will be exchangeable for EVAA DAO Tokens in the future.
While the campaign has officially ended, the reward pools with attractive APYs are still available in the app:
Similarly, DAOLama held a farming season and introduced Reward Points (RPs), an internal token designed to incentivize users through their in-app activities. Every loan issued earned RPs, which can be exchanged for $LLAMA. The promotional period ended on March 30, and users can now trade the token on STON.fi and DeDust.
RedStone is the First Oracle Solution on TON
Oracles are crucial components in blockchain technology because they act as bridges connecting blockchains to the outside world. They provide a reliable way to feed external data onto a blockchain, such as token or stock prices. This capability is vital for enabling smart contracts — self-executing contracts with the terms directly written into code — to interact and react to external events.
RedStone becomes the first oracle available on TON, which marks a major milestone in the data integrity for TON-based DeFi.
RedStone highlights that TON, with its asynchronous and fully decentralized nature, required a significant shift from the usual integration methods, involving more complex inter-contract messaging instead of straightforward contract interactions typical in other blockchains. Looking ahead, RedStone aims to bolster TON’s DeFi ecosystem through a new relayer system for consistent price updates, smart contract templates for easier integration, and advanced data feeds to meet the growing needs of TON-based DeFi. Learn more about the integration here.
Future Outlook
Jettons on the TON blockchain are carving out a unique niche, representing a diverse spectrum of digital assets that go beyond traditional utility. While some of these jettons may have yet to define practical applications clearly, they still hold an important place in the broader ecosystem.
Surging interest in these diverse assets can be the starting point for a larger process: the increasing demand for DeFi infrastructure to meet the capital efficiency requirements of token holders. We can already see evidence of this with the success of the incentive campaign as part of The Open League.
To be honest, since I discovered TON in 2022, I have never believed in it. NEVER. I thought, “It would be just another ghost chain.” But as you see, it didn’t. My first interaction with TON was at the end of 2022 when I had mid-2 figs in crypto (yes, 2-figs) and won a giveaway.
The admin of this Telegram channel DM’d me and said, “Yo, can I send you your prize in TON on Telegram wallet?” I was just like, “What? Telegram wallet?” He kindly explained it all and sent me a prize. It was $10, by the way. Thank goodness TON has low fees so I sent it to CEX.
When I started writing threads and leveraging content creation by learning 24/7, I became deeply involved in marketing strategies. For some reason, I did not like TON’s marketing strategy back then. 6 months later, I still do not fully like their marketing strategy. But as we see numbers of TVL and TON price, it was effective, despite my opinion.
I started hearing about TON from normies who weren’t involved in crypto at all. TON is cheap, accessible, and easy-to-understand. This is why normies were farming Notcoin a lot. At the moment of writing, TON is at #9 in “Today’s Cryptocurrency Prices by Market Cap,” according to CoinMarketCap.
Despite the fact there are many things to improve, just like marketing (hello Const), TON will be paid more and more attention in the future. Numbers of active users, TVL, and TON market cap are crazy, and I truly didn’t expect this flywheel.
defizard, The ZKasino Survivor & The Derivatives Monke Slayer
As the DeFi landscape on TON becomes increasingly complex, the demand for reliable and secure oracle services will grow. RedStone’s efforts in this area suggest a trend towards the higher-level data integrity on TON. We can expect oracle solutions to penetrate the ecosystem further in the near future.
What to build on TON now?
We look forward to seeing:
- Solutions that bring EVM capabilities to TON
- DEXs with non-standard order execution models, including limit order book-based exchanges
- Autocompounders/yield optimizers
Do you have ideas about bringing more value and utility to our DeFi ecosystem? DM us on Twitter or visit our official website: https://top.co.
