What Draws Pantera Capital to Make TON Its Largest Investment Project?

Pantera Capital is a cryptocurrency and blockchain asset management company headquartered in San Francisco, established in 2013. They specialize in managing and investing in digital assets, including Bitcoin, other cryptocurrencies, and projects related to blockchain technology. Pantera Capital's investments span multiple areas, including digital payments, decentralized finance, smart contracts, and blockchain infrastructure.

According to The Block's April report, Pantera manages $5.2 billion in assets through three fund strategies and plans to raise $1 billion for its new cryptocurrency fund, Fund V. Publicly available information shows that Pantera Capital has invested in a total of 193 projects, with 80 of them being lead investments. Their investment focus primarily revolves around infrastructure and DeFi, accounting for over 50% of their portfolio.

In the latest edition of the Blockchain Letter, Pantera Capital partner Ryan Barney mentioned that TON is their largest investment ever. Let's explore why Pantera Capital is heavily invested in TON. The following points summarize Pantera Capital's expressed views in the article.

Backed by Telegram with a potential 900 million monthly active users

TON is a Layer 1 network originally designed by Telegram and continued by the open-source community. Pantera Capital believes TON has the potential to introduce cryptocurrency to the masses, given its widespread use within the Telegram network. Telegram, a forward-thinking, fast, and secure messaging platform, boasts over 900 million monthly active users, utilized for individual and group communication, large-scale community building, and content sharing.

By leveraging Telegram's vast user base and seamless user experience, along with the vibrancy of the emerging TON ecosystem, Pantera Capital sees potential for TON to become one of the largest cryptocurrency networks.

Telegram and Signal: Monthly downloads in January 2024

The spirit of Web3

Telegram stands out not only because of its platform's wide distribution but also because it embodies the spirit of cryptocurrency. Telegram is the only major platform unencumbered by regulation, capable of integrating Web3 into an open blockchain network.

At Token2049, Pavel explained why TON and Telegram are a perfect fit: “I love blockchain because it's a liberating technology—it gives power back to the people.” No other social messaging app positions itself in this way.

High performance and scalability

TON features a multi-component ecosystem, including the TON blockchain, TON storage, TON DNS, and TON services, all integrated seamlessly to operate together.

The backbone of this system, the TON blockchain, is designed for high performance and scalability. With its dynamic sharding mechanism, it can rapidly process transactions. This architecture ensures the network can handle millions of transactions per second and scales effectively with increasing user numbers, making it an ideal choice for developers looking to launch applications for hundreds of millions of users without compromising speed or security.

Low user entry barriers

Users entering the blockchain industry often require a Web3 wallet, where traditional wallets typically involve users jotting down 12 or 24-word mnemonic phrases for safekeeping.

Telegram's wallet, however, offers both custodial and self-custody management based on TON, ensuring all users enjoy a seamless onboarding experience while allowing experienced users to opt for full control over their keys.

Mini crypto applications

Telegram supports mini crypto applications, including chatbots and mini-games. Through TON, Pantera Capital anticipates integrating cryptographic technology into these “mini applications,” significantly enhancing the user experience for hundreds of millions of users.

Others

Pantera Capital believes that TON is providing the Telegram community with various monetization, sharing, and business development opportunities. Take Fragment for example, as a decentralized marketplace on the TON network, Fragment offers a platform where users can trade collectibles such as virtual phone numbers and custom Telegram usernames.

Additionally, on April 19, 2024, Tether announced the deployment of its stablecoin, USDt, on the TON blockchain and Telegram wallet. This development represents a significant advancement in the crypto industry as it enables hundreds of millions of users to seamlessly send and receive stablecoins through the Telegram platform, making payments as easy as using Venmo or Apple Cash.

Summary: Pantera Capital outlined seven key reasons for their heavy investment in TON. The core rationale is that TON is a Layer 1 network designed by Telegram, boasting high performance and scalability. Telegram, being a secure, privacy-preserving social messaging platform with a large user base, combined with TON, can deliver a Web2-like social messaging platform experience in line with the spirit of the cryptocurrency industry.