Toncoin Faces Major Sell-Off Risks – Here is Why

A prominent cryptocurrency analyst warns that Toncoin (TON), a notable competitor to Ethereum (ETH), may face significant selling pressure soon.

Ali Martinez shared that concerns are growing following Telegram’s recent announcement to share user data with authorities under specific circumstances.

Originally developed by Telegram in 2018, Toncoin was abandoned by the platform in 2020 after legal challenges with the U.S. Securities and Exchange Commission (SEC), with management later taken over by an open-source community of developers. Despite this separation, Toncoin remains accessible to Telegram’s 900 million users for transactions within the app, bypassing the need for lengthy wallet addresses.

Recently, Telegram’s founder, Pavel Durov, was detained by French authorities for allegedly failing to regulate content related to drugs, fraud, and other illicit activities.

In response, Durov announced updates to the platform’s terms of service and privacy policy, stating that user IP addresses and phone numbers could be shared with relevant authorities upon valid legal requests. He emphasized that the platform should not be misused for illegal activities and is intended for connecting friends and sharing news.

Martinez suggests that the potential loss of what he describes as Telegram’s “most appealing feature” could trigger a decline in Toncoin’s value. He also noted that Toncoin’s price movement might be mirroring that of Celestia (TIA), a Layer-1 modular blockchain that has plummeted from over $20 in February to below $4 recently.