4Alpha Research Researcher: 17

Recently, Binance Labs announced an investment in Pluto, the parent company behind the Telegram mini-game Catizen. As one of the hottest mini-games in the Telegram ecosystem, Catizen will also launch its token soon. This article will provide readers with a comprehensive introduction to the development status of Catizen and discuss the implications for the future development of the Telegram and TON ecosystems.

Introduction to Catizen Basic Information

1. What is Catizen?

Catizen is an ultra-casual cat-raising mini-game in the Telegram ecosystem, with the slogan "Play for Airdrop." The game officially launched in March 2024 and had over 1 million players in its first week of public testing. As of July 29, according to official data, the total number of players exceeded 26.95 million, with 1.47 million daily active users, 1.61 million on-chain users, 20.74 million on-chain transactions, 2.01 million Twitter followers, and 5.25 million channel subscribers.

Catizen has completed three rounds of financing, with the latest round being invested by Binance Labs.

2. Gameplay

Catizen is an ultra-casual mini-game with relatively simple gameplay. Players take on the role of a cat café owner, managing up to 12 cats of different levels at the same time. Every two cats of the same level can be combined to create a higher-level cat. Cats can produce tokens, and as the level of the cats increases, the number of tokens produced per second also increases. Tokens can be used to directly purchase higher-level cats in the store to speed up game progress. In addition to the normal game content, Catizen also incorporates many social factors, such as inviting new users to earn diamonds, which can be exchanged for cash.

Overall, the gameplay of Catizen is very similar to the popular WeChat mini-game "Cute Dog Transformation" from 2018. The player's goal is to continuously combine cats to obtain higher-level cats, gaining a sense of achievement, the joy of raising, and potential airdrops. However, compared to Cute Dog Transformation, Catizen remains relatively monotonous aside from its core gameplay.

3. Economic Model

Currently, the Catizen ecosystem involves four types of non-tradable in-game tokens: vKITTY, Fish, xZEN, and $wCATI. The overall token economy has not been fully disclosed.

It is known that CATI will be listed on exchanges as a tradable token; vKITTY and Fish are functional tokens within the game. The output speed of vKITTY is an indicator of game progress, and according to official data, users with high public vKITTY output speed in July will be prioritized for airdrops. Fish is a utility token in the game that can be consumed to indirectly increase the output speed of vKITTY, and the only way to obtain Fish is through recharging (aside from completing beginner tasks).

It can be seen that the entire token economic system of Catizen determines that users who want to obtain a higher airdrop ratio must spend money, and cannot simply rely on multiple accounts with zero spending; because for players with zero spending, the output of vKITTY has a limit, and ultimately, players whose vKITTY output does not meet the standard may not receive airdrops or may receive very few.

4. Data Performance

The following data about Catizen mainly comes from official disclosures at different times and is for reference only.

As of July 29, according to official data, the total number of players exceeded 26.95 million, with 1.47 million daily active users, 1.61 million on-chain users, 20.74 million on-chain transactions, 2.01 million Twitter followers, and 5.25 million channel subscribers.

Catizen officially launched in March 2024, and by the 10th week after launch, the total registered users surpassed 10 million, with daily active users exceeding 2 million, 400,000 paying users, and cumulative on-chain revenue exceeding 11 million USD, with nearly 80% of the revenue coming from $TON.

As an ultra-casual mini-game, it typically has a low payment rate, but Catizen achieved nearly a 4% payment conversion rate solely through in-game purchases, generating 25 USD in revenue per paying user and 1.1 USD in revenue per user. Catizen's data is still impressive even when compared to traditional ultra-casual mini-games in overseas markets.

5. Future Roadmap

1. Q1 2024 Launch (Completed): Game Launch, adopting Play-to-earn Airdrop Model (under review)

2. Q2 2024 Token Issuance (Delayed): Listing on mainstream exchanges, airdropping to early users and supporters

3. Q3 2024 Platformization: Introducing a platform economy with token staking and locking, allowing users to earn NFTs and airdrops from new games through token staking; introducing a revenue-sharing mechanism for game income

4. Q4 2024 Innovation: Introducing AI and AR versions, collaborating to attract traditional gamers

5. Q1 2025 Game and Platform Optimization: Increasing user base, optimizing platform mechanisms

6. Q2 2025 Innovative Feature Optimization: Introducing new features for AI and AR versions

7. Q3 2026 Cat Universe: Starting the development of the Cat Universe

According to Catizen's plan, it has completed the first phase of its cold start period, gaining a large number of users and is transitioning to a token-based LaunchPool.

6. Development Team

The development team behind the Catizen game, Pluto, has rich experience in game development and operation, and has prepared a sufficient reserve of mini-games to continue launching new products after Catizen. Currently, their official website shows that there are 38 mini-games pending Web3 adaptation.

Thoughts on Catizen and the TON Ecosystem

After in-depth research on Catizen, we have the following thoughts and predictions regarding the TON ecosystem:

Tokens

According to the latest official white paper, the economic model of Catizen's governance token $CATI is as follows, with portions belonging to the team, seed round investors, and advisors set to unlock linearly 12 months after TGE, with a total expected release over 4 years (this portion accounts for 30% of the total). $CATI is already tradable on Bybit's Pre-Market, and as of August 1, the latest transaction price was 0.7 USD, corresponding to an FDV of 700 million USD; while the currently fully circulating $NOT has an FDV of 1.35 billion USD.

It is worth mentioning that Catizen is not the first game launched by the Pluto team on TON. As early as 2023, the Pluto team ported a game called Tap Fantasy, which was originally operated in the BSC ecosystem, to the TON ecosystem and launched its token. Currently, the FDV of Tap Fantasy's token Magic Crystal ($MC) is 16.48 million USD.

Opportunities in the TON Ecosystem: Large Growth Space, Foundation for Mass Adoption, and Payment Capability

(1) The TON ecosystem has a large user base, and there is still significant room for growth in on-chain activity.

Since January 2024, the number of active addresses on the TON ecosystem has been continuously increasing, currently reaching a new high of around 450K daily active users, surpassing Ethereum's on-chain daily active users (around 400K). The on-chain daily active performance of TON is comparable to that of high-activity L2s like Arbitrum and Base.

We can infer the potential ceiling for the activity level of the TON ecosystem from the development status of the WeChat mini-game ecosystem. Currently, WeChat has around 1.3 billion monthly active users, with 750 million active users in mini-games, and the most popular mini-games have over 100 million monthly active users, reaching 8% of WeChat's monthly active users. Telegram currently has around 900 million monthly active users, and if we benchmark against WeChat mini-games' conversion rates, we have reason to expect the emergence of mini-game products in the Telegram ecosystem with over 70 million monthly active users. If we estimate based on a 10% on-chain user conversion rate for Catizen, the on-chain monthly active situation in the TON ecosystem still has several times of growth potential. Currently, only Solana has achieved over a million active addresses, and TON is the next public chain with such potential.

(2) The TON ecosystem provides "channel" support and can offer high conversion rates.

The narrative of reducing intermediaries' profits through Crypto has been around for a long time, but before TON, this narrative was difficult to realize for two main reasons.

First, there was a lack of good distribution channels. In a highly competitive Web2 payment environment, channels often determine payment methods rather than the other way around. Therefore, while it is reasonable to argue for taking away the profits of intermediaries in Web2 and giving them to users, it is challenging to promote. This limitation not only restricts the promotion of Web3 payment methods but also hinders the development of all Web3 products that rely on large DAUs (such as games and social applications). Telegram, due to its background, actively supports Crypto, becoming the first channel with sufficient traffic and motivation to promote decentralized payment methods.

Second, the conversion rate has been low. In the past, Web3 projects were limited not only by channels but also by poor wallet experiences leading to low conversion rates, making traditional advertising channels less meaningful. Telegram integrates wallets, dApps, and fiat on/off ramps, which can effectively improve conversion rates.

Based on these two points, the TON ecosystem provides official channel traffic support (the TON Foundation has actively promoted Catizen on multiple occasions) and has built the infrastructure for converting traffic into users, making it logical to expect a TON ecosystem with a large number of wallet users.

(3) Users in the TON ecosystem have payment capabilities.

For traditional game developers, the narrative of Web3 game platforms "bypassing platforms, reducing cuts, and increasing profits" has finally become possible. By default, in-game recharges require purchasing Telegram's virtual token Star through the App Store, and then using Star to buy in-game items, which involves various cuts.

However, if users recharge through an independent Top-Up Bot, they can purchase items directly from Catizen using $TON / $USDT at a 10% discount. In the first two months of Catizen, over 80% of the revenue, exceeding 11 million USD, was paid through $TON. This scale is enough to make us expect the emergence of a Web3 channel with almost no intermediary cuts.

(4) The ecosystem is still relatively early.

As mentioned earlier, Catizen's gameplay has not made significant innovations compared to "Cute Dog Transformation" from 2018. This situation is not unique to Catizen; many mini-games on Telegram are simple ports of early mini-games already validated on WeChat, lacking innovation in gameplay and even facing reductions. Therefore, even if the TON ecosystem relies on the old path of iterating domestic mini-games, there is still significant room for development.

In addition to game quality, mini-games in the TON ecosystem rely on a single monetization model through in-app purchases, lacking substantial integration with advertising monetization. Therefore, if the TON and Telegram game ecosystems can develop, an advertising platform targeting Telegram ecosystem and TON on-chain users is bound to emerge.

Risks in the TON Ecosystem: Population Limitations and Token Centralization

(1) The spiritual core of mini-games differs from Crypto and still requires exploration of financial applications.

For exchanges, acquiring new user registrations through TON's mini-games is relatively feasible, as users will inevitably need a scenario for fiat conversion after receiving token airdrops. Currently, Pixelverse has already partnered with Bybit's Web3 wallet; TapSwap has also integrated tasks for new user registrations on Binance.

However, the more important factor is the conversion rate of these new users continuing to participate in trading after selling their tokens.

From the author's personal perspective, even with the successful example of the $NOT token, the retention of new Crypto users brought in by casual mini-games in exchanges may still not be ideal. The main reason is that the casual mini-game model is fundamentally closer to PoW, where effort yields rewards, emphasizing a return on investment; while the exchange model is more akin to a gambling model of "willing to bet, willing to lose," producing a thrill of ups and downs. The two products have fundamentally different cores in terms of their target audience.

Therefore, in addition to exploring the direction of mini-games, it is still necessary to actively explore DeFi products in the TON ecosystem to fully leverage the advantages of the TON ecosystem in channels and conversion rates.

(2) Telegram users are not concentrated in crypto-friendly regions with strong payment capabilities.

According to Statista data, the top five regions for Telegram downloads are India, Russia, the United States, Indonesia, and Brazil, most of which are not crypto-friendly. In contrast, Japan and South Korea, which have strong enthusiasm for trading cryptocurrencies and high payment capabilities for mini-games, do not even make it into the top ten.

(3) Centralization of the $TON token.

Many data indicate that over 90% of $TON tokens are concentrated in 100 addresses, and the centralization of $TON tokens is a sword hanging over every participant and builder in the ecosystem.

(4) The unavoidable PointFi; the current token issuance model in the TON ecosystem is prone to manipulation.

Since Telegram mini-game payments support both on-chain and off-chain methods, and the game's values and logic are not fully on-chain, when using in-game "points" or "values (such as token output)" as the standard for airdrops, it leaves a lot of uncertainty. Before the token release, it is extremely difficult to predict the true distribution of chips.

Conclusion

This article primarily explores the potential of the TON ecosystem through the lens of Catizen. For mini-games, there is often no fixed methodology for creating a hit; it relies more on "emergent innovation" and "high-efficiency deployment." From a gameplay perspective, Catizen does not belong to the heavy game model that can lock in high-paying players for the long term. The future development potential of Catizen and $CATI depends on its $CATI token economic model's empowerment (whether it is a game with a token or if $CATI serves as a governance token throughout) and Catizen's subsequent operational and selection capabilities.

Regardless of how Catizen develops, its current success reflects many potential issues and opportunities within the TON ecosystem, which still deserves our long-term attention.

References

https://docsend.com/view/h9x78qwy4yz2bfd7

https://www.youxituoluo.com/532105.html

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