TON, the native currency of Toncoin, a blockchain network, is under immense selling pressure. Despite maintaining its spot in the top 10, the recent dump has sowed doubts and widened cracks in an otherwise solid uptrend.
TON Is Down, Liquidity Provider Sells
According to CoinMarketCap, TON is down nearly 18% in the past trading week but stable on the last day. However, the coin is firm over the last six months. A glance at the TON daily chart shows that it is up nearly 200% and maintains an uptrend.
If there is an extension of August 24 losses, TON might fall and retest the immediate support level marking July lows at around $4.8. Even so, further losses could trigger panic selling among holders, fueling another wave of selling pressure. In turn, this will confirm the losses over the weekend.
On August 26, Lookonchain analysts noted that one large liquidity provider (LP) exited the market, selling over 350,000 TON worth $1.98 million. Interestingly, the LP chose to sell in bulk at $5.57.
Hours after this, prices are in green, edging lower, as evident in the daily chart. The situation could worsen in the coming hours or days should other “small” holders follow this trend.
Typically, when large token holders, in this case, the liquidity provider, choose to liquidate, it creates a domino effect. Since these entities are assumed to be more informed than retailers, it can be interpreted that their market outlook is bearish.
As a result, following their steps and securing at current prices could mean exiting when the liquidity is high and profits decent.
Pavel Durov Of Telegram Arrested, What’s Next For Toncoin?
For now, it remains to be seen whether TON holders will continue selling, following the liquidity provider’s path. However, what’s clear is that the selling pressure of August 24 could shape the short to medium-term trend. It will be especially a turbulent time for TON holders should bears press on, breaking below $4.8.
Triggers for this dump will be if Pavel Durov, the CEO of Telegram, is detained for longer. Over the weekend, Durov, whose messaging app is closely linked to the open source The Open Network, was arrested in Paris, France.
Rumor is that Durov’s arrest circles around Telegram, whose messages are encrypted. Authorities claim that the messaging app, led by Durov, did not place sufficient measures to moderate. They also allege Telegram didn’t cooperate with law enforcement to extinguish suspected criminals.
In a statement, Telegram said Durov has “nothing to hide.” Furthermore, the team said the messaging app is committed to ensuring standard moderation practices while complying with EU laws.
Feature image from Wikimedia Commons, chart from TradingView
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