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Following the controversial arrest of Telegram founder Pavel Durov over the weekend by the French authorities at the Le Bourget airport, the Toncoin (TON) network, a fast-growing layer one chain, has exploded with on-chain activity. Amid fears of the possible impact of Durov’s arrest, TON price has recently accelerated its downward trajectory.
TON Price Action Turns Bearish
The large-cap altcoin, with a fully diluted valuation of about $28 billion and a daily average traded volume of around $1.3 billion, closed last week at about $5.8, down over 18 percent.
As a result, it is safe to assume that TON bears are in control and that further bearish pressure will continue.
Furthermore, TON price, against the US dollar, in the weekly time frame saw the Relative Strength Index (RSI) drop below the 50 percent level for the first time since February.
Is Toncoin Network Likely to Face Liquidity Crunch Crisis?
While some investors have opted to show support for Durov through direct investment of TON and its projects, on-chain data shows a liquidity provider has opted to exit the market.
Precisely, Lookonchain identified a liquidity provider who sold more than 356k TON, worth nearly $2 million, earlier today.
Nevertheless, the decision of one sole liquidity provider cannot be extrapolated to other entities unless a pattern is established. Furthermore, TON has more than $3.4 million in liquidity in different DEX exchanges led by Uniswap (UNI).
Market Picture
The Toncoin network was earlier outperformed by Tron (TRX), as the TON price dropped towards $5.5 on Monday. Nevertheless, the Toncoin network remains a major web3 ecosystem, with over $619 million in stablecoins supply and over $388 million in total value locked.
The launch of successful meme coins – led by Notcoin (NOT) and DOGs – has significantly helped the Toncoin network remain relevant and competitive in the industry.