On the one hand the Telegram team have a solid track record & a lot of users: They produced a high quality app that’s used by hundreds of millions of users. Also add to that the fact that more of the crypto chat related channels are on telegram.
On the other hand if you read through the white paper they put out, they give a timeline that promiss to do everything from wallets, to distributed file storage/computing/exchanges. That’s a very high bar to set without providing a lot of technical details. A leaked copy of the white paper can be read here:
https://drive.google.com/file/d/1ucUeKg_NiR8RxNAonb8Q55jZha0...
Personally I think it’s worth taking a small bet on them. The biggest problem in crypto right now is a lack of widely used consumer apps. Getting hundreds of millions of people to use an app is a harder than solving some of the distributed systems problems facing crypto right now in my book. I could see the telegram team pulling this off.
This isn't a matter of one startup failing where another stands a chance. The problems that Telegram is proposing they can solve aren't execution problems. They are unsolved research problems. And some of those problems (like verifiable computing) have been actively researched for decades, well pre-dating cryptocurrency and Bitcoin.
Everybody has blinders on.
Large adoption can smooth over a lot of flaws, and Telegram has the right tools and vision for achieving that.
The big risks I see with the Telegram ICO have nothing to do with the tech. They are as follows:
A) They build out all this functionality to support crypto currency, etc and it sees low adoption/usage with their users.
This happened with Snapchat and messenger when they introduced the ability to send money. People still used Venmo, including many of my friends who work at Facebook.
B) They roll out this tech, it starts taking off, Facebook detects it and they smoother it by cloning the functionality and rolling it out in messenger/WhatsApp. Aka what happened to Snapchat with stories.
Do you want to be specific? I suppose one question is do they need to pull off everything they claim in the whitepaper in order to be successful? Do you feel the things the Telegram team promise are an all or nothing deal.
If they just had hundreds of millions of people using Telegram for payments and perhaps filestorage/bots backed by crypto could they do that without all the things promised in the white paper? Would the market consider that a success and would that be reflected in the currencies price?
Not OP but the whitepaper claims that it wants to produce a decentralised blockchain product with the same efficiency and scale of credit cards or similar payment methods.
Now I'm not terribly knowledgeable as far as crypto currency is concerned, but as far as I'm aware that's a yet unsolved problem because there's a payoff between security, performance, and decentralization.
The article mentions sharding but sharding usually reduces security, you can increase the block size but that will lead to centralisation, and so forth.
The scale / decentralisation trade-off is inherent to almost all complex systems. Overcoming it is a pretty big thing to promise.
Not sure if I am reading the white paper correctly but I think Telegram appear to be going with a masternode type solution initially for their proof of stake solution
https://en.m.wikipedia.org/wiki/Proof-of-stake:
“Another form of staking is running a masternode,[9] a form of decentralized server. The main disadvantage of operating a masternode is the relatively high barrier to entry as opposed to staking alone. In order to secure the network, those willing to run a masternode are required to purchase a certain number of coins as collateral at current market price.”
Will a solution like this, which is more centralized than something like btc be good enough? Will people be happy with this level of centralization or refuse to use the service on principle? I don’t know. I do think that at least the earlier parts of their roadmap seem plausible (2018). The 2019 section however does seems rather ambitious and ambiguous.
I think if you're careful about it, sharding can be done without impacting security much. Suppose you would split the Bitcoin network exactly in half. Each half has only has as much hashpower, so you can attack it for half the cost. But each side also contains only half as much money, so the potential payout went down by the same factor as the price of attack.
Of course it's more complicated than that, because a realistic attack isn't about stealing money from everyone but from a handfull of large targets. Also, TON is proof of stake and not proof of work. And you have to scale sharding not with money present, but with transaction rate. And the shards (presumable sidechains?) will transfer money between each other, and you have to scale that as well. It's a complicated problem, but I wouldn't rule sharding out as a viable approach.
I highly doubt they can do the promised "millions of transactions per second" in any realistic scenario, that would be a major breakthrough. VISA can only do 57 thousand transactions per second [1]. But I also don't think they need remotely that much. Paypal has an average transaction rate of ~200 transactions/second, VISA of ~1700 transactions/second. At least paypal's average rate would be achivable even with Bitcoin's codebase if you were to take some liberties with block time and size (which isn't entirely unreasonable, the internet got faster in the last 8 years)
1: https://mybroadband.co.za/news/security/190348-visanet-handl...
I don't think this is correct, if it were split in half each side would start at the same point with the exact same amount of money. Unless you were talking about the amount of money each half controlled maybe?
But I thought the point of sharding was to enable double-spending which would only really concern itself with the amounts the attacker(s) controlled. Well, I also recall reading about using sharding to destroy faith in the network as a whole but that doesn't seem to apply here.
They do not. Telegram still does not encrypt chats.
>“It’s a pitch that sounds good to V.C.s that haven’t participated but makes no sense to people that have been in the space,” said Nick Tomaino, the founder of a virtual currency investment fund, 1confirmation, that didn’t invest in Telegram.
>The most obvious reason to be skeptical of the project is that there is not even a prototype — just a 132-page paper promising what the system will look like one day. The Telegram team is promising to release the software late this year or next year.
>What’s more, Telegram is promising to do more than any other virtual currency and to fix the intractable problems that have plagued virtual currencies like Bitcoin, such as overcoming the network’s difficulty handling all the transactions that have poured onto the network as it has become more popular.
>An analyst at one virtual currency-focused hedge fund, Pantera Capital, wrote a scathing essay noting that the Telegram team has given no evidence that they will be able to solve the problems that have dogged everyone else.
>“I cannot, in 132 pages, gain the slightest intuition as to how to go about proving that the hard problems it needs to solve will be solved,” the analyst, Charles Noyes, wrote about the Telegram project on Medium.