Toncoin (TON) has experienced a tumultuous period, suffering a significant drop of over 25% in value following the arrest of Telegram founder Pavel Durov on August 25. The coin, which fell to a low of $4.45 by September 6, saw a partial recovery with a 15% rebound, bringing its price back above $5.15 by September 9. Despite this bounce, technical indicators suggest that TON could be poised for further declines.
Inverse Cup-and-Handle Pattern – A Bearish Signal for Toncoin
The recent recovery in Toncoin’s price could be short-lived due to a bearish technical pattern known as the inverse cup-and-handle. This pattern, often seen as a continuation of a downtrend, forms a rounded top followed by a brief period of consolidation. Once the price breaks below the pattern’s neckline, a further decline is typically expected.
On September 3, the TON/USDT pair slipped below the critical neckline support at $5, entering what analysts describe as the breakdown stage of the inverse cup-and-handle pattern. The price briefly retested this neckline as resistance but failed to regain ground, signaling that the previous support had flipped into a barrier for further gains.
If TON continues to face resistance at this level, the bearish pattern could fully play out, potentially dragging the price down to $3.60—a 30% drop from its current value. However, if bulls can retake the $5 level and hold it as support, the downtrend could be invalidated, offering some hope for investors.
Crackdowns and Legal Woes Weigh on TON
Adding to the pressure on Toncoin is its close association with Telegram and its founder, Pavel Durov. Durov’s arrest has sparked renewed scrutiny of Telegram, particularly in regions like South Korea and India. In South Korea, the app is under investigation for allegedly facilitating deepfake crimes, while India—Telegram’s largest market—launched a probe shortly after news of Durov’s arrest surfaced. Indonesia is also considering a ban on Telegram, citing concerns over content moderation, and the European Union is reportedly investigating the platform for privacy violations.
This wave of legal challenges has fueled negative sentiment around Toncoin, as investors worry about the potential for further instability. The close ties between TON and Telegram have raised concerns that any fallout from these legal issues could impact the coin’s performance in the coming months.
Whales and Developers Unfazed by Downtrend
Despite the challenges, some large investors, known as “whales,” seem unfazed by the legal drama. On-chain data from Santiment shows that holdings among Toncoin’s largest investors—those with balances between 10 million and 100 million tokens—have actually increased since Durov’s arrest. This accumulation suggests that these big players may see the current dip as a buying opportunity, possibly betting on a longer-term recovery.
Moreover, the Toncoin ecosystem continues to expand, with the total value locked (TVL) across its network rising even as prices declined in September. Recent developments, including the launch of gaming and meme coin projects like DOGS, have drawn new users and developers to the platform, providing some optimism for TON’s future.
While the technical outlook for Toncoin points to further downside risk, particularly if the bearish inverse cup-and-handle pattern plays out, there are signs that the ecosystem’s growth could help offset some of the negative sentiment. As long as legal challenges surrounding Telegram continue, however, Toncoin’s path to recovery remains uncertain. Investors will be watching closely to see whether TON can reclaim its crucial support levels or whether further declines are on the horizon.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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