TON’s Path to Decentralization: The Evolution of the Governance Model

Co-Authored by Steve Yun, President – The Open Network Foundation & Jack Booth, Co-Founder – TON Society

The TON community has matured impressively in the past year. TON keeps connecting the crypto industry to a mass audience of new users, while successful projects constantly emerge. Advocating for decentralization and reactive to community growth and maturity, The Open Network Foundation (“Foundation”) introduces Society DAO, a new governance model.

TON has been community-driven from day one. From its inception, the network has thrived thanks to dedicated community validators, securing its integrity, and resilience. The platform’s growth has been led by developers who won public contests, becoming the leading contributors committed to TON’s vision. TON’s launch was uniquely fair, with initial distribution powered by Proof-of-Work mining, allowing participants to earn a stake. As the ecosystem expanded, the TON Foundation took the helm in business development, fueling a robust and dynamic ecosystem loyal to its decentralized, community-first ethos.

Honoring this DNA, The Open Network Foundation (“Foundation”) introduces Society DAO, a new governance model. We envision a governance framework that enhances decentralization, transparency, inclusion, competition, autonomy, participation, and resilience by democratizing access to the financial, socio-political, and human capital.

Decentralization: A Progressive Journey

Decentralization is an ongoing process. Over the past year, many founders have relied heavily on the Foundation for success, as it often serves as a central hub for capital. However, the Foundation sees this as a centralization risk—one that could lead to a single point of failure.

How can the Foundation evolve to mitigate this risk and empower a more resilient, decentralized ecosystem?

Challenges in L1 Governance: The Limits of the Corporate Model

L1 governance faces complex challenges, starting with a concentration of capital. Across the blockchain industry, platforms often adopt a corporate model, with foundations overseeing strategy, partnerships, marketing, technical support, funding, and more. This centralized model can be efficient in the early stages, providing direction and producing initial use cases.

However, as the ecosystem matures and independent, competitive participants emerge, this model reveals its limitations. Capital and resources—financial, social, human, and political— accumulate around the foundation, making it difficult for projects to succeed without its official

support. This concentration creates a gated environment, stifling the competition that’s crucial for a thriving ecosystem.

Additionally, operational inefficiencies arise as projects focus on navigating foundation processes instead of building products, leading to a lack of competitive innovation. Over time, this dependency risks undermining the original goal of ecosystem building, which requires decentralized, open support for incoming builders.

Solutions for a Decentralized and Competitive Ecosystem: The Community Model

To address the challenges of centralized governance the answer lies in democratized access to capital and fostering competition within a community-centric framework. By implementing

open-source access to capital, projects earn resources transparently, rewarded for achieving key performance indicators (KPIs), which shift their focus to delivering exceptional products and results. In line with this, the Foundation is advancing a Community Model that redistributes resource allocation power back to the community. Under this approach, respected and proven community members are empowered to coordinate vision, goals, and strategies, collectively determining resource allocation in alignment with TON’s overall growth.

This model also upholds a principle of competition, supporting at least two projects in each category, encouraging projects to excel, and fueling a vibrant innovative ecosystem. Previously monopolized roles within the Foundation can now be filled by competitive, independent teams, enhancing efficiency and resilience. Thanks to TON’s explosive growth and the emergence of widely respected ecosystem leaders, the Community Model enables proactive, autonomous, and competitive participation in the network.

Since its inception in 2023 as a Swiss non-profit, the Foundation has tested this model with a few leading teams, who have excelled in their roles. This competitive and decentralized model accelerates growth, promotes autonomy, and empowers community-led development, providing a scalable framework and better results for all TON ecosystem participants.

Introducing Society DAO: Advancing the network adoption as a community

With blockchain technology, the technical path to decentralization is clear. However, building a community capable of collective, coordinated action requires a more strategic approach. As the TON ecosystem grows, decentralizing at its core is essential to ensure resilience and long-term success.

Today, The Foundation is pleased to introduce Society DAO and its founding members; teams that have already been operating independently yet aligned with TON’s mission. Society DAO will become the organizing body for core ecosystem functions, its founding members comprise:

• TONCore:Core development, upgrading, and maintenance of the blockchain
• TONStudio:Developer experience
• TONSociety:Community operations
• WalletinTelegram:Payment adoption

The Foundation will support this DAO by reporting on its goals, KPIs, and strategies, ensuring compliance, and providing grants and other resources. Society DAO will grow to include proven and reputable community teams that can propose and execute a plan that supports the ecosystem’s objectives. It will welcome new contributors across roles such as marketing, app development, technology, stablecoin integration, DeFi, community growth, identity, and more.

This model will make the community’s brightest minds the key stakeholders in the growth and adoption of TON.

TON Ecosystem Goals: A Transparent Route to Success

The TON ecosystem is committed to a transparent path for accomplishing its goals. Like our network’s dynamic sharding architecture, smaller, independent, and focused teams can create better, more scalable outcomes. Our public goals are revisited every six months, ensuring they remain relevant and aligned with our community’s vision.

Key Features of Society DAO

• TONEcosystemGoals: Society DAO will publish The TON Ecosystem goals
• CommunityProposals: DAO members can propose relevant strategies, expected time-bound, and specific key results for achieving the ecosystem goals.
• WorkingGroupReviews: Relevant DAO members will evaluate proposals across specialized working groups.
• GrantProvided: After DAO approval, The Foundation funds the plans, with the community team assuming responsibility for progress and performance.

Initial Goals of Society DAO

Today, Society DAO sets the following initial goals:

1. PositionTONasTheGatewaytoReal-WorldCryptocurrencyUseCases.
2. EstablishTONastheMostStableandScalableBlockchain.
3. GrowtheDeveloperandUserCommunityinSuperAppmarkets.

By January 2025, Society DAO will publicly publish the key initiatives and expected key results for H1 2025. With a public view over Society DAO’s objectives, the community can contribute their opinions and help guide the DAO on how best to achieve the Ecosystem goals. Shortly, Society DAO will continue to decentralize by inviting proposals from proven and reputable community teams. Successful proposals that align with our ecosystem goals can join the DAO as members, becoming core contributors to The Open Network.

Debate and TON Society Reputation

In 2025, Society DAO will enhance its transparency and community-driven focus by launching a public debate and voting platform. This platform will use TON Society onchain badges as a reputation marker, empowering active community members to have a voice in decision-making processes.

Over 3.6 million users have earned onchain badges on society.ton.org. This activity-driven reputation reflects your contribution and engagement within the ecosystem and will open access to contributing to debates and onchain votes.

Once the platform is live, DAO members will be supported by the real opinions of the active community. Together, we will cultivate an ecosystem of DAO members that self-regulates autonomously by collective insight and engagement.

The Principle of Competition

To ensure a decentralized approach, Society DAO is establishing the Principle of Competition as a core guideline for allocating all public resources, including financial, social, human, political capital, and incentive programs. This principle requires that at least two competing projects be provided with the opportunity to fulfill the KPIs in the same category.

Competition creates decentralization. Competitive environments make it difficult for single players to dominate. When an ecosystem depends on multiple players, it becomes more resilient to failures. If one competitor encounters issues or fails, others can take their place without significant disruption. Competitive ecosystems lead to higher transparency, as entities are motivated to act in users’ best interests to maintain loyalty.

Moreover, competition encourages different approaches and ideas to address user needs. Each competitor brings unique strengths or innovations, leading to a richer ecosystem where multiple solutions coexist, reducing reliance on any single provider. Ultimately, this leads to a better user experience.

Society DAO: Shaping a Resilient and Scalable Future for the TON Community

Society DAO positions the TON community on the right trajectory to become more competitive, decentralized, and resilient. Overall, it aims to create a robust and scalable organizational structure. As this model continues to be proven further, it will lead to an autonomous community capable of collective action.

With a growing community of over 20 million members, we are stronger than ever and have the potential to make cryptocurrency accessible to everyone. Together, we can drive meaningful change and put crypto in every pocket.

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