People who leave Telegram mini-games

Author: Jaleel Jia Liu

Last week, the power struggle and split within the Yescoin team brought attention back to the "TON ecosystem." It has been too long since we heard from the TON chain, and we began to reminisce about this public chain backed by Telegram, which was on the "eve of takeoff" for three years but ultimately only thrived for a few months.

At its peak, trading platforms rushed to launch tokens for Telegram mini-games. In just over four months, Binance, the world's largest cryptocurrency exchange, successively listed five tokens from the TON ecosystem. Hundreds of mini-games emerged in a short time, with over 2,000 more in preparation for launch. Notcoin's monthly revenue exceeded $300,000, and Catizen achieved over $16 million in revenue. The TVL data of the TON chain grew by 70 times. The price of TON also rose from $2 to a peak of $8. Market expectations for the TON ecosystem reached an all-time high, and both inside and outside the industry believed that the "traffic gold mine" of Web3 had finally found a new outlet for explosion.

However, this seemingly thriving ecosystem was merely a speculative game with a very short time window. By the summer of 2024, the market came to a sudden halt—trading platforms stopped listing TON ecosystem coins, the founder of Telegram was arrested, project teams fell silent, and player groups formed "ghost towns." Overnight, this track, once called a "traffic gold mine," turned into an emptied-out mine, leaving behind only data black boxes, an overdrawn market, and abandoned developers.

What exactly happened during this time? We interviewed three former Telegram mini-game project teams to analyze the true reasons behind the "flash in the pan" of the TON ecosystem.

False Prosperity; Black Box Traffic

The low customer acquisition cost of Telegram mini-games had long been a topic of discussion and was one of the reasons most Telegram mini-game project teams chose to pursue their projects. In hindsight, it is also the root cause of the entire ecosystem's bubble.

"In Web3, a company like a trading platform or a large chain game has a customer acquisition cost of around $10 to $15, but through Telegram mini-games, this cost can be far below $1, around $0.7." KinKin, who left the Telegram mini-game project six months ago, has now shifted her focus to AI Agent research. She added to Rhythm BlockBeats: "In some regions, it's even more exaggerated; in India, the acquisition cost can be as low as $0.002 to $0.05."

This extreme compression of customer acquisition costs created a paradise for project factories, while real users became a dispensable existence for them.

"Before I joined, I didn't really need real users; the studio's volume was enough. In a very short time, we could achieve a scale of 200,000 to 300,000, which is a qualifying line for a Telegram mini-game, considered a light to medium scale." Xiaoguang, who has managed multiple token launches for Telegram mini-games, did not shy away from discussing the industry's operational model when asked by Rhythm BlockBeats.

This approach has been standardized and proceduralized in the industry. Several long-term cooperative studios are adept at it, even surviving longer than most Web3 projects. "The project team and the studio would agree on how much volume is needed in the early stages and how much needs to be supplemented before the TGE (Token Generation Event)," Xiaoguang explained. If merely boosting volume isn't enough, they would resort to "volume swapping" to amplify the data.

"After reaching a scale of 200,000 to 300,000, we would engage in volume swapping—essentially redirecting traffic between two games to reach the next level." Xiaoguang added. Compared to traditional chain games, the data volume of Telegram mini-games has far exceeded that of most Web3 projects. But everything has two sides; low costs often mean low quality, and the inflation of data obscured the real issues within the ecosystem.

"The data of the TON ecosystem has always been operated as a black box. In the past, those VC projects could be checked on data platforms like Dune, where you could see how many addresses and transaction volumes there were, and investors would conduct some background checks. But the real data of Telegram mini-games is not public; only a few insiders know the approximate number of users and the real user ratio." In Xiaoguang's view, this is a natural soil environment for project factories.

"Do you know how many real users Notcoin has? You don't." Xiaoguang stated bluntly, "All the data that outsiders see is what the project team wants you to see."

The decline in the real user ratio further exacerbated the market's false prosperity. "In the early games, like Hamster Kombat, it was considered relatively good, with about 60% being real people. But as the ecosystem expanded, this ratio continuously declined, and later on, having 40% was already considered impressive." Xiaoguang revealed to Rhythm BlockBeats.

Even among this 40%, the professional airdrop hunters' "airdrop tax" had not been excluded; their goal was not to play games but to obtain airdrop rewards. "When we counted the recharge users, among the remaining real users, 90% of the addresses were from the same group of people who specifically chased airdrops, played a bit, and then left."

This user structure directly determined the vicious cycle of the Telegram mini-game ecosystem—short-term, data inflation obscured the real situation, allowing investors and trading platforms to continue paying; but in the long term, the overall user quality of the ecosystem was extremely poor, and user stickiness was very low.

To trading platforms and investors, on the surface, the monthly active data of Telegram mini-games was astonishing, with massive traffic, but the actual user retention and conversion rates were pitifully low. "If the only goal is to create monthly active data and wallet address numbers for trading platforms and investors to see, then this low-cost traffic is sufficient." The speaker was Sleepy, the founder of the Little Ghost NFT, who confirmed that they had decided to pause mini-game development on Telegram this month.

"But if you want truly active users, users who are willing to play your game and use your application, you absolutely cannot acquire them at such a low customer acquisition cost." Sleepy stated. "Looking back now, it's still that saying—'you get what you pay for.'"

"Our promotion methods still rely on Crypto circle Twitter, community promotion, and crypto advertising channels, along with mutual volume swapping between projects," Sleepy said. "But swapping back and forth, we still haven't managed to break out of this circle."

In other words, traffic merely flowed from one project to another, but the entire pool of water remained stagnant, with no new fresh water being injected.

The TON ecosystem never truly bridged the gap between Telegram's 900 million users and Web3; it seems that the TON Foundation and Telegram did not establish a genuinely effective distribution channel that could allow Crypto applications to reach a broader audience. Sleepy said, "Maybe they are trying hard, but I haven't seen any results yet."

TON and Telegram have never been the same thing.

TON Foundation: Vacuum Power and Uncontrolled Direction

In the past six months, when discussing the TON Foundation with industry insiders, they always mentioned the "factional struggles" within the TON Foundation: the Russian team, the Taiwanese team, and the Dubai team after obtaining a financial license in Dubai. These three teams did not bring about a synergistic effect; instead, they made resource allocation within the TON ecosystem extremely uneven—whether one could receive support often depended on their relationship with the Russian team.

The TON Foundation was initially founded by two core members, one of whom is Steve Yun, the current chairman of the foundation who is still active in various online and offline events, and the other is Andrew Rogozov, the former CEO of VK (the predecessor of Telegram, which was the first social platform created by the Telegram founder, the Russian version of Facebook), who is considered a "core circle figure" by some.

However, at some point, the power structure of the TON Foundation underwent a subtle change—Andrew Rogozov seemed to fade from the core management of the foundation and founded TOP (The Open Platform), which now seems more like a real foundation than the TON Foundation, or rather like Consensys within the TON ecosystem, even leading the core ecological construction of TON.

"To be honest, as a foundation, we actually don't receive much information from Telegram. Pavel Durov and the others don't discuss anything with us; in fact, they only communicate with the wallet team because the wallet is the only real integration point. And that is not our team; it's a completely different company called TOP." This was stated by Jack Booth, the marketing director of the TON Foundation, in an interview in July 2024, indirectly confirming TOP's influence.

TOP's influence gradually surpassed that of the TON Foundation, not only investing in and supporting the most critical projects on TON but also controlling the infrastructure within the ecosystem—they are responsible for running the official Telegram wallet TON Space, supporting the most active wallet in the TON ecosystem, Tonkeeper, and the DEX with the highest trading volume, Stonfi. Even the only staking protocol, Tonstakers, is also supported by TOP. From the perspective of key nodes in the TON ecosystem, TOP has become the de facto "core builder" of TON, while the TON Foundation has become more like an external publicity agency, with its power gradually being undermined.

Then, on January 14, 2025, the TON Foundation announced the appointment of board member and Kingsway Capital founder Manuel Stotz as the new president, while the former president Steve Yun would continue to serve on the board.

In such a "power disintegration," it is understandable why there are rumors that "the TON Foundation, led by the Taiwanese team, has almost no say in many matters."

The weak position of the Chinese members of the TON Foundation in ecological resource allocation has become more apparent. "The Taiwanese team has no say; core technical decisions are still in the hands of the Russian team," Xiaoguang pointed out. "If you can build a good relationship with the Russian team, you can get the most support. For example, Catizen has a very good relationship with the Russians, receiving investments and a lot of resources."

Xiaoguang's words are corroborated by TOP's investment list, which includes Catizen's game developer, Pluto Studio.

Another popular mini-game, Notcoin, was founded by Sasha Plotvinov, who openly stated that he has a very close relationship with the TON Foundation. This relationship not only gave Notcoin an advantage in the TON ecosystem but also made it a benchmark project in the Telegram mini-game track. More notably, Sasha Plotvinov is also the CEO of Open Builders, and the products under Open Builders overlap significantly with TOP, also belonging to the "core circle figures." "DOGS is also made by the Notcoin team; it's all controlled by the Russians," Xiaoguang said, "and there are many similarities in their trends."

Looking at the price charts of the three coins from last August to now, their trends are indeed very similar. Additionally, on March 16, affected by the news that "Telegram founder Pavel Durov was allowed to leave France," some tokens in the TON ecosystem rose, including: TON with a 24-hour increase of 20.7%, currently priced at $3.53; NOT with a 24-hour increase of 18.7%, currently priced at $0.002543; DOGS with a 24-hour increase of 10%, currently priced at $0.0001475. (Prices are as of March 17 when this article was written.)

From top to bottom: TON, NOT, DOGS

The success of Catizen and Notcoin, to some extent, is not a success of the track but rather a high concentration of core resources within TON. These two projects launched more than half a year earlier than most mini-games and received full support from the foundation. In other words, the prosperity of TON mini-games was not a true "open ecosystem" but a resource allocation game.

Another fatal issue within the TON ecosystem is the confusion and abrupt turns in strategic direction—regarding resource support, the TON Foundation's focus rapidly shifted from Telegram mini-games to DeFi, directly leading to many mini-game developers being forced to abandon their projects.

"When we were in contact with the foundation, we could clearly feel that after a certain point, they basically stopped paying attention to all game-related projects and started frantically searching for DeFi projects," Sleepy said. "This sudden shift was a huge blow to teams that were seriously developing products, causing many developers and users to leave."

Sleepy strongly disagrees with the direction shift made by the TON ecosystem: "I think TON shouldn't just copy what other public chains are doing. Without relying on Telegram, TON cannot achieve the current user volume from the perspectives of performance, language, and development difficulty. Therefore, TON's future development should be planned according to the characteristics of social platforms, rather than copying other public chains."

"Our initial judgment of TON was that its ecosystem would become part of the monetization of traffic on social platforms like WeChat mini-games or Douyin mini-games." However, the TON Foundation's decisions completely deviated from this direction. "They are making stablecoins and DeFi, which are huge mistakes, just like WeChat making stock trading mini-programs; would you use WeChat mini-programs to trade stocks?" Sleepy stated bluntly.

This strategic misstep by the TON Foundation not only caused the ecosystem to miss the correct narrative direction but also directly triggered a crisis—In August 2024, TON founder Pavel Durov was arrested in France. This incident dealt a significant blow to the TON ecosystem and plunged the foundation into chaos.

"The reason is actually that they added a function similar to fiat currency exchange for stablecoins, which involves compliance and political factors, especially against the backdrop of the Russia-Ukraine war," Xiaoguang revealed to BlockBeats. Prior to this, BlockBeats had also heard similar viewpoints from other sources, suggesting that a function related to stablecoins had attracted regulatory attention.

The original ecosystem of TON had already fallen into chaos due to strategic wavering and uneven power distribution, and the founder's sudden incident further caused the ecosystem to lose its last support point.

"Death Accelerator": Project Factories and Trading Platforms

In addition to the black box of traffic, the factional struggles within the TON Foundation, and the sudden shift in resource support, project factories and trading platforms are also key factors accelerating the demise of the Telegram mini-game track. This ecological carnival is essentially a brief capital game, while real user growth has long stagnated.

In this track, the development of games is extremely industrialized; project factories produce various mini-games in bulk using an assembly line model, experimenting in the market, and a few projects always manage to succeed. "For example, the game developer behind Catizen, Pluto Studio, initially ran a dozen games and eventually found that the cat breeding model was the best, so they decided to focus on it," KinKin said.

In other words, Catizen's success was not accidental but the result of intensive project experimentation. This model is essentially high turnover, low cost, and rapid trial and error.

"This cost is actually very low," KinKin explained. "Many game developers directly look for verified games in the WeChat mini-program market, obtain the game code, change the skin of the H5, and then apply a Telegram IDK (Integrated Development Kit) to go live directly. Moreover, in the later stages, the price of these mini-game codes has become increasingly cheaper."

Low costs, short cycles, and quick launches give these game projects extremely high speculative attributes. More critically, once a game model is validated by the market, it will be quickly copied and amplified, and the leading projects often mean having "pricing power." KinKin mentioned: "Catizen was very strong in negotiations with trading platforms when discussing listings, even leaning towards OKX and asking for $500,000."

Once a project succeeds, its bargaining power significantly increases. Catizen's strong negotiation ability comes from the market experience accumulated after multiple project failures and accurately identifying a user group willing to recharge. "Mini-games like Catizen, which have been validated through a dozen projects, indeed have products that are mature enough and have attracted a wave of real users willing to spend money," KinKin said.

The success of leading projects also brings another problem—highly concentrated resources. "The traffic of a single project like Hamster Kombat can almost rival that of a medium-sized trading platform."

However, the ecosystem of Telegram mini-games has never had "fresh water" coming in, lacking the entry of external incremental markets. The high-density "bombardment" of project factories leaves almost no survival space for other mini-games, let alone Web2 game developers—they hold a large number of abandoned, unlisted games with very low trial and error costs, and in this competitive environment, the Telegram mini-game track accelerates its decline.

Another driving factor is the competition among trading platforms. The traffic brought by TON mini-games made trading platforms see new growth points, leading to frequent listings in the short term, which caused the market to be overdrawn too early. Looking back at Binance's listing timeline, it can be seen that the intervals between new projects are getting shorter:

May 16: Notcoin listed;

84 days later: TON listed;

13 days later: DOGS listed;

23 days later: Catizen listed;

13 days later: Hamster Kombat listed.

"When DOGS was listed, all trading platforms were scrambling for this data, even offering rewards for activities like 'withdraw from my trading platform, and I will give you some DOGS back.' Why did they know DOGS had traffic? Because NotCoin had already proven it once; NotCoin and DOGS were made by the same team, just changing the skin and following the NotCoin model again," KinKin told BlockBeats.

The deeper issue is that the user growth rate during this cycle has far lagged behind the previous cycle. At least before Trump issued his coin, the market's anxiety about user growth in Web3 was very evident, and this anxiety naturally transmitted to trading platforms. Although the user quality of the Telegram mini-game track is uneven, at least in the early stages, the conversion of TON traffic could still bring some data growth to trading platforms. However, this data growth is essentially unsustainable.

Ultimately, the more projects the project factories have, and the faster the trading platforms list coins, the quicker the track cools down.

After several rounds, the incremental user base of trading platforms gradually dried up, losing the motivation to continue listing coins. For latecomers, the first-mover advantage has been maximized, and the survival space for later projects and coins is shrinking. All of this makes the collapse of the Telegram mini-game ecosystem inevitable.

Is TG + Web3 a False Proposition?

"Have you ever envied those projects that can get listed on Binance?" In response to BlockBeats' question, Sleepy answered quickly, clearly having thought about this issue long ago.

"It depends on how you define success. Many people think being listed on a trading platform is a form of industry recognition, but I don't feel that way. For me, issuing a coin is not the end of a project. If you treat it as the endpoint, it will hurt you, hurt the community, and hurt investors. Because everyone can see that these coins perform poorly after listing, and the effect of attracting new users is far from the expectations of trading platforms." Sleepy said.

The "quick money logic" of the TON ecosystem made everything simple and crude—changing to a new project every three weeks, with the quick-money operators dominating the market's rhythm, while the teams that genuinely wanted to make games became the eliminated "outliers." In this ecosystem, idealists ultimately have two choices: either abandon their beliefs and go with the flow, or be eliminated.

Sleepy and his team ultimately chose the latter. He cut 80% of the team, and several core members temporarily stopped taking salaries, reallocating some resources to do Web2 design outsourcing to sustain the team's survival.

"In addition, we are also discussing grants with some public chains; we have already received our first Launch Grant and will continue to do some development work to complete the remaining KPIs. We have also applied for some hackathon competitions like Monad Madness to see if we can achieve some results. Currently, our income over the past few months has already exceeded what we earned from making games on TON," he joked.

After the collapse of the TON ecosystem, various people who were once active within it found their new paths.

KinKin has now shifted to the AI Agent track, and she is very optimistic about the future development of the BASE chain. Xiaoguang, who is good at project management, is researching memes. He has long understood that "the business of Telegram mini-games is structural; it has never been a stable model, and the window period is only a few months." A former member who worked hard to promote the ecosystem at the TON Foundation has left to study the public chain Kaia, which merges WeChat in South Korea and Japan.

In an ecosystem where traffic reigns supreme, only the traffic itself remains. The TON ecosystem did not become "the future of crypto social," but merely another cyclical Web3 narrative, a market game that is shorter, faster, and with more extreme returns than public chains and ZK tracks.

Looking back at this carnival today, for developers, the TON ecosystem once disguised itself as the hope of "social + Web3," attracting them into this market, only to turn them into producers of black box data; for players, airdrops created the illusion of "getting rich overnight," but the result was merely a $0.99 game gift package becoming the "cyber incense money" of the new era.

When looking at the entire industry, the rise and fall of Telegram mini-games is not an isolated phenomenon; it is merely an extreme "microcosm" of the entire Web3 industry. In fact, whether it is public chains, ZK Rollups, or Layer 2, the essence of many tracks is the same, just packaged in a more "glorious" way, with higher costs and longer cycles. Most Web3 projects are essentially doing a large-scale Telegram mini-game, just with varying lifespans.

"Is TG + Web3 a false proposition?"

Each interviewee provided their own answer, but I decided not to write it down because, dear readers, this time, I want to hear your thoughts.

This article thanks all the interviewees who provided information; for privacy protection, some interviewee information has been anonymized.