TVM Ventures has recently introduced a $100 million fund, aiming to promote the expansion of The Open Network’s on-chain offerings. This move signifies a shift in focus, as the network aims to reduce its reliance on L2s.
According to TVM, the fund’s objective is to provide startups and enterprises with both capital and infrastructure support in order to drive widespread adoption of TON, a blockchain developed in collaboration with the messaging app Telegram. The fund will achieve this by encouraging development on TON’s base layer, rather than on its L2s or side chains.
Steve Yun, a board member of the TON Foundation, warned that if TON fails to develop its own blockchain, it will simply become another Ethereum Virtual Machine (EVM) L2, where people come to launch “new” projects that merely copy and paste smart contracts written years ago.
The fund will focus its investments on three key areas: decentralized finance infrastructure, cross-border payments, and security on TON. Within this investment framework, TVM Ventures plans to prioritize DeFi protocols that allow users to store and save their cryptocurrencies, as well as access other traditional banking-like services. Additionally, it will allocate funds to accelerate projects addressing inefficiencies in remittances and the broader cross-border payments sector.
In terms of security, TVM Ventures has committed to supporting the safety of its portfolio protocols by collaborating with advanced security auditors for the TON Virtual Machine.
TON, which was launched in 2021, aims to onboard at least 500 million users to the Web3 platform. Originally conceived by Telegram, TON eventually shifted its development to an external community of builders due to regulatory concerns. However, Telegram and TON have become increasingly intertwined over the past two years, with various applications attracting a substantial number of Telegram users to the network. One notable example is TON Wallet, an application launched on Telegram that facilitates tap-to-earn crypto games like Hamster Combast, Notcoin, and Catizen, which have attracted hundreds of millions of players.
Nevertheless, Yun envisions a future where the TON community focuses primarily on its own blockchain, rather than side chains and L2s. Building on Layer 1 provides users with a more decentralized and secure experience compared to building on Layer-2 networks, which often prioritize speed over security. This approach also helps prevent the fragmentation of liquidity.
Yun emphasized that TON stands at a critical juncture and must choose between relying on L2s and side chains or dedicating itself to its own chain. TVM Ventures has made its decision, opting for the latter.
Edited by Stacy Elliott.