On the night of June 28, mining of Toncoin was officially completed. This follows from the zero balances of all the givers in the blockchain.
Thus, mining in the TON network has finally ended after almost 2 years. The first opportunity to mine in this network appeared on July 6, 2020.
It should be recalled that the TON, i.e. The Open Network, project was originally developed by Pavel Durov’s team, but due to the requirements of the American regulator, the head of Telegram had to run the project on the Open Source. Now its development is being carried out by the open community of TON Foundation developers.
The TON blockchain itself works according to a unique scheme: the network algorithm uses the Proof-of-Stake (PoS) consensus mechanism, that is, maintaining its operation does not require calculations (mining). However, smart contracts with a balance (givers) were placed on the network, allowing anyone to mine coins by mining these smart contracts up to the present day.
Thus, the TON blockchain was unique thanks to a combination of both approaches - it worked on (PoS), but the distribution of coins took place using the Proof-of-Work (PoW) technology.
The main result of mining is the fair distribution of coins among tens of thousands of volunteers. The TON project did not conduct an ICO, IEO, or any other coin sales. In the TON Foundation, this approach is called IPOW (Initial Proof-of-Work), according to the TON developers, it has obvious advantages that other crypto projects will be interested in.
We already answered this question in our March report on TON mining. Three months ago we talked about the future - now it has come.
Mining will be replaced by TON staking. It will be possible to receive new coins not by mining, but by providing your personal coins as collateral to validators / nominators at interest. We will publish a new article on this topic soon.
An inflation mechanism is inherent in the network operation: about 0.6% of coins from the total issue will be generated every year. Validators with their power and huge liquidity reserves will confirm transactions within the TON network and earn their commissions from this.
Validators require a huge supply of liquidity (TON coins) to keep the TON network functioning. Liquidity will be provided to the validator by nominators (an intermediary between ordinary users), and ordinary users will lend their coins to the nominators, eventually receiving their percentage from it - this is what is called staking. Roughly speaking, this can be compared to a deposit account in a bank.
After the initial distribution of coins, TON enters a new stage - increasing the number of validators and coins participating in the validation, which leads to strengthening the stability and security of the network.