Article written in collaboration with Ryan Lee, Chief analyst at Bitget Research.
Toncoin, the native token of The Open Network (TON) public chain, presents a unique set of
characteristics distinct from more established platforms like Ethereum. This analysis delves into
the technical underpinnings of TON, exploring its multi-chain architecture, asynchronous smart
contracts, distributed hash table storage, and the role of the TON Proxy. By examining minute-
level K-line data and conducting backtests, we aim to provide insights into potential trading
strategies and the overall market dynamics of Toncoin.
TON’s main features
Multi-Chain Architecture : The TON public chain consists of a main chain, multiple work
chains, and shard chains. Each work chain can have different rules, account formats,
transaction formats, and virtual machines. However, different work chains must adhere to the
basic interoperability standards of the TON blockchain. Each work chain can be subdivided into
multiple shard chains as needed. Shard chains are responsible for maintaining account states,
converting, and transmitting information between different shard chains.
Asynchronous Smart Contract Calls : Smart contracts on the TON public chain use
asynchronous message passing and non-atomic transaction processing, which is significantly
different from how smart contracts are executed on the Ethereum chain. Asynchronous calling
and execution make the design and implementation of smart contracts on the TON chain more
complex but also provide greater scalability and flexibility.
Distributed Hash Table Storage : The distributed hash table (DHT) storage system on the TON
public chain is an efficient and reliable distributed storage solution. It uses a protocol similar to
Kademlia, supporting efficient data lookup and storage while ensuring data availability and
security. This enables the TON public chain to support large-scale distributed applications and
services, offering users stable and secure data storage solutions. TON’s DHT and Ethereum’s
Merkle Root each have their own advantages and disadvantages. TON’s DHT improves data
storage and access efficiency and reliability through high availability and decentralization but
faces challenges related to data consistency. Ethereum’s Merkle Root has advantages in data
integrity verification and simplicity of implementation but has limitations in scalability.
TON Proxy : The TON Proxy is a key component of the TON public chain ecosystem designed
to enhance network privacy and security. It is similar in design to the Invisible Internet Project
(I2P), used to hide the identity and IP address of network nodes. For high-value nodes handling
large volumes of cryptocurrency transactions or responsible for block validation, the TON Proxy
provides an additional layer of protection against DDoS (Distributed Denial of Service) attacks.
The TON Proxy is a distributed system with no central server; all nodes can participate in data
routing and forwarding, enhancing the decentralized nature of the network.
Technical Metrics Analysis
By obtaining minute-level K-line data of TON for the past week and running strategy backtests,
it can be observed that trading TON’s minute-level K-lines using an RSI strategy could yield an
absolute weekly return of 11.2%, higher than the 7.89% return from holding the token. The
specific trading strategy is to sell the token when the 14-day RSI index exceeds 78 and to buy
when the RSI index falls below 25. The current minute-level RSI is around 46, indicating no
clear trading opportunity. However, it should be noted that backtest data does not guarantee
future results, and the return data is for community reference only.
