The TON blockchain experiences major decreases in multiple essential statistical indicators, which raises doubts regarding its crypto industry prominence.
The DefiLlama platform registers decreased figures for total value locked along with app revenue, Toncoin’s price, market capitalization, unique daily active addresses, DEX trading volume, and total value locked. Recent decisions by TON’s developers have led to discussions about potential negative effects of network growth and adoption.
Declining user activity and market performance
TON achieved substantial growth by launching Hamster Kombat on Telegram, making the game popular enough to reach 100 million users. Blockchain operations reached their highest point during September 2024 as its user address count reached 1.81 million active addresses. Early in October the peak number of users occurred on TON since it reached 11.8 million active users. The Telegra.ph platform has logged less than 202,000 daily active wallets combined with 5,100,000 monthly users as tracked since February 5th.
Toncoin, the blockchain’s native token, has also experienced a sharp drop. After reaching an all-time high of $8.24 in June 2024, the token has fallen by more than 54%, trading at $3.75. Toncoin is down over 1.7% in the past 24 hours, more than 22% in the past week, and over 31% in the last month.
Increasing selling pressure and reduced transactions
The IntoTheBlock on-chain data shows that more than 96% of Toncoin holders (more than 108 million addresses) hold their tokens at a loss, constituting only 4% of all profitable holders. The bearish investor sentiment has become stronger because exchanges received 240,000 Toncoins. The transaction caused a 2% price decrease, which marked the end of January.
The blockchain faced another wave of sell-offs after the arrest of Telegram CEO Pavel Durov, which led to the sale of over 800,000 Toncoin. Transaction volume and DEX trading activity have also decreased. On February 5, transaction volumes stood at 2.7 million, a steep decline from the 18.1 million recorded September 18. Trading activity on DeDust and STON.fi has also dropped significantly.
Controversial updates lead to backlash
TON’s latest network updates have drawn criticism from users and developers. The blockchain recently announced that it would become Telegram’s exclusive blockchain, requiring all mini-apps on the platform to integrate with TON’s infrastructure. While bridging apps were exempted, the move has led to dissatisfaction among developers.
Another controversial decision was TON’s shift from an open to a closed network. This change has led some projects to reconsider their presence on TON. The Telegram-based game Frens Farm announced that it would delay its token launch and instead launch on Base.
The cryptocurrency transaction system under TON requires users to use TON Connect which no longer permits using alternative wallet services. According to public reports, a representative from the TON Foundation declared that external wallets would receive no post-migration support. According to Helika Ventures director Ilya Abugov, the quick change in terms could reduce developer and exchange interest in TON. Bybit recently took partial action against HMSTR while Hamster Kombat expressed plans to develop its proprietary blockchain network.