Toncoin market cap loses $3 billion after Telegram founder’s arrest

Investing.com – Toncoin , the token tied to The Open Network (TON), has lost roughly $3 billion in market value since Telegram Messenger LLP’s co-founder, Pavel Durov, was arrested by French police on Saturday. 

The token's value plunged after reports surfaced that Durov was detained at a Paris airport on charges of allowing drug dealers and sex criminals to operate on Telegram. The arrest is also said to be linked to charges involving data privacy and violations of cryptocurrency regulations.

Toncoin's price dropped by as much as 25% on Sunday, hitting a historic low of $5.24 as panic selling took hold following the news of Durov’s arrest. Toncoin was trading at $5.68, up less than 1% by 06:40 ET (10:40 GMT).

Telegram app has been key in integrating Toncoin into its ecosystem, with Durov a central figure in the token's story and future growth. As such, his arrest sparked a wave of panic selling among Toncoin traders.

The current price drop for Toncoin mirrors the behavior of Binance's BNB token, which also took a steep dive before bouncing back strongly after the legal troubles of its CEO, Changpeng Zhao (CZ), subsided. 

BNB fell by roughly 15% before CZ’s sentencing in April, but once the market absorbed the news, the token surged by nearly 35%. Toncoin could follow a similar trajectory, where initial panic might eventually lead to a recovery as traders reevaluate the situation. 

Meanwhile, the X account of The Open Network (TON) blockchain posted a statement about Durov's arrest in France. The tweet assures users that “the TON community is still strong and fully operational.” 

“As a community committed to freedom of speech and decentralization, we stand firmly by Pavel during this challenging time," TON’s statement said.

Toncoin (TON) was originally developed as part of Telegram’s broader vision to create a decentralized platform that goes beyond messaging, bringing blockchain technology into its ecosystem. TON is designed to integrate with the Telegram app, enabling features like in-app payments, bot payments, and microtransactions, while also supporting a strong ecosystem for decentralized applications (dapps).

Source: Investing.com