Market reaction to Pavel Durov’s arrest continues to impact Toncoin price

Amidst overall market uncertainty, Toncoin (TON) experienced a modest increase of 0.32% to $5.39 during the August 31 trading session. 

This movement reflects a consolidation trend below the 200-day exponential moving average, indicating that bears are currently controlling market momentum, Caliber.Az reports, citing CoinGape.

Telegram’s financial report for 2023 reveals the company’s significant involvement in the crypto sector, with up to 40% of its revenue sourced from cryptocurrency-related activities. This includes the integrated Telegram Wallet for crypto transactions and the Fragment platform for username sales.

Despite the rise in revenue, Telegram concluded 2023 with a loss of $108 million. The company's balance sheet shows that it holds $400 million in crypto assets, surpassing its cash reserves.

The price fluctuation of Toncoin (TON) could have a substantial impact on Telegram’s financial stability due to the company’s substantial stake in this crypto asset. Since last week, Toncoin has faced aggressive selling pressure following the arrest of Telegram founder Pavel Durov, leading to a 22% decline in the asset's value.

Daily chart analysis reveals a descending trendline defining the current correction phase, with bearish sentiment prevailing despite an overall rise in cryptocurrency prices. Should the selling pressure persist, Toncoin's price could fall by an additional 12% to reach $4.72, a horizontal support level unchanged since March 2024.

If sellers breach this critical support and turn it into a resistance zone, Toncoin's price may continue its correction down to $3.30. Conversely, the $4.72 level is a key accumulation point for buyers, which could lead to a reversal of the trend from bearish to bullish. In such a scenario, Toncoin’s price might encounter the current resistance zone at $6.91.