Key Insights:
- Telegram’s involvement in distributing illicit content in South Korea has sparked an investigation, casting uncertainty on Toncoin’s future.
- Toncoin’s price faces downward pressure, with major investors increasing holdings, while smaller holders are selling amid the ongoing legal issues.
- Technical indicators show Toncoin nearing oversold territory, reflecting the market’s response to Telegram’s mounting legal challenges.
Toncoin (TON) is facing significant market pressure as Telegram, the messaging platform associated with the cryptocurrency, is under investigation in South Korea. The platform’s legal issues in the country have raised concerns about Toncoin’s future value, with the price potentially falling below $5.
Telegram’s Legal Issues in South Korea Spark Investor Concern
South Korean authorities have initiated an investigation into Telegram due to its alleged involvement in distributing deepfake pornography. This investigation, led by the Seoul Metropolitan Police Agency, is part of a broader effort to tackle digital sex crimes in the country.
The investigation focuses on whether Telegram played a role in the spread of illicit content, which has alarmed investors. The scrutiny on Telegram is not limited to South Korea, as similar investigations are reportedly underway in other countries, including France, India, and Indonesia.
Impact on Toncoin’s Market Performance
The ongoing legal challenges faced by Telegram have created uncertainty in the market, particularly for Toncoin. As the cryptocurrency associated with Telegram, Toncoin is feeling the effects of this scrutiny, with its price hovering around $5.21. Investors are increasingly cautious, fearing that the ongoing investigations could push Toncoin’s value below the critical $5 mark.
Despite the bearish outlook, data indicates that major Toncoin investors, or “whales,” are increasing their holdings. According to data from Santiment, wallets containing between 1 million and 10 million TON have seen a significant rise in balances since August 26. This increase coincides with news of Telegram founder Pavel Durov’s arrest in France, further fueling market speculation.
In contrast, smaller investors are reacting differently. Wallets holding between 10,000 and 1,000,000 TON have seen a decrease in balances, suggesting that these investors are selling off their assets amid market uncertainty.
Technical Indicators Point to Further Price Declines
The technical analysis of Toncoin’s price movements reveals a bearish trend. Currently priced at $5.21, Toncoin is near the lower band of the Bollinger Bands at $4.76, indicating potential support at this level. The resistance level is set at $7.31, with the middle band at $6.05.
The Aroon indicator also reflects this downward trend, with the Aroon Down line (orange) above 50% and the Aroon Up line (blue) close to 0%, signaling strong bearish momentum. Additionally, the Relative Strength Index (RSI) is at 35.99, suggesting that Toncoin is approaching oversold territory.
The market pressure on Toncoin is expected to continue as the investigation into Telegram progresses. The legal challenges faced by Telegram, combined with the current technical indicators, suggest that Toncoin’s price may decline further before a potential reversal occurs.
As the situation develops, investors are advised to closely monitor both the legal proceedings and Toncoin’s market performance to make informed decisions.
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