Crypto Analyst Says Large-Cap Ethereum Rival at Risk of Massive Sell-Off – Here’s Why

A popular crypto analyst thinks one large-cap Ethereum (ETH) rival could be at risk of a massive sell-off.

Ali Martinez tells his 72,400 followers on the social media platform X that Toncoin (TON) could be in for rough weeks ahead following a new announcement that the messaging platform Telegram will provide user data to governments under certain circumstances.

Telegram initially developed Toncoin in 2018, but it parted ways with the project in 2020 following a legal battle with the U.S. Securities and Exchange Commission (SEC). The Open Network, an open-source community of developers, took over management of the technology that year.

TON, however, can still be sent by Telegram’s 900 million users within the platform without entering long wallet addresses.

Pavel Durov, Telegram’s founder and chief executive, was arrested by French authorities last month on a warrant related to his platform’s alleged failure to moderate content linked to drugs, fraud and other criminal activities, a move decried by numerous high-profile free-speech advocates.

On Monday, Durov announced on Telegram that his platform was updating its terms of service and privacy policy.

“We’ve made it clear that the IP addresses and phone numbers of those who violate our rules can be disclosed to relevant authorities in response to valid legal requests.

These measures should discourage criminals. Telegram Search is meant for finding friends and discovering news, not for promoting illegal goods. We won’t let bad actors jeopardize the integrity of our platform for almost a billion users.”

Martinez says getting rid of Telegram’s “most compelling feature” could contribute to a Toncoin selloff.

He also thinks TON’s chart could be “following the path” of Layer-1 modular blockchain Celestia (TIA), which crumbled from a high of more than $20 in February to a low of less than $4 this month.

TON is trading at $5.70 at time of writing. The 10th-ranked crypto asset by market cap is up nearly 1.5% in the past 24 hours.

 

Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

Generated Image: Midjourney