Toncoin risks: what can go wrong when you use TON
Toncoin carries smart-contract bugs, bridge hacks, phishing, staking lockups and regulatory uncertainty; Telegram's SEC case ended its original project.
Vahe HakobyanEditor-in-chief
Updated Oct 6, 20263 min readFact-checked
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TON began with Telegram, but the company no longer controls the network. It runs on proof-of-stake validators and sharding, which creates technical risks.
What are the main risks of TON?
Using TON puts you at risk from code, other users and regulators. Wallets, bridges and staking services can also be custodial or lock your coins, which adds counterparty risk.
- Smart-contract bugs. A flaw in an app can drain the funds it holds.
- Bridge hacks. Bridges that move coins between networks are common targets.
- Phishing. Fake sites and messages can trick you into giving up wallet keys.
- Staking lockups. Some staking services lock your coins for a period.
- Regulatory uncertainty. US crypto rules are still developing.
What is Toncoin and how does it work?
Toncoin is the native coin of The Open Network, usually called TON. You use it to pay fees and to stake for the right to validate blocks. The network uses proof-of-stake validators and sharding, so contract risk and slashing risk exist. A validator can lose staked coins for breaking rules.
Who created TON and what happened legally?
Telegram started TON and sold tokens to fund it. In 2019, the SEC sued Telegram, saying the token sale was an unregistered securities offering. A court halted the project in 2020, and a settlement ended Telegram's original plan. The current TON network is independent from Telegram.
Frequently asked questions
No. Telegram's Gram token was part of the original TON project and did not launch. Toncoin belongs to the network that continued after the court case.
Yes. Validators can be slashed and lose staked coins, and some staking services lock funds for a period. A custodial service adds counterparty risk.
TON transactions are irreversible, so the coins usually cannot be recovered. If the address belongs to an exchange, ask its support team, but there is no guarantee.
The SEC case and 2020 settlement ended Telegram's original token project, but they did not clear the current TON network of securities law questions.
