Toncoin, a cryptocurrency linked to the popular messaging app Telegram, experienced a sharp decline in market value on Monday, losing approximately $2.7 billion. The sudden drop came after the arrest of Telegram’s co-founder and CEO, Pavel Durov, at Le Bourget Airport near Paris on Saturday evening. Durov’s arrest was carried out by French authorities in connection with allegations that he failed to take sufficient measures to prevent criminal activity on Telegram, particularly related to the protection of minors.
Following the arrest, Toncoin, which is considered one of the top ten competitors to Bitcoin, saw its value plummet by around 20%. By Monday morning in Singapore, Toncoin was trading at $5.69, down 16% from its previous value, reflecting the significant market impact caused by Durov’s detention. Despite being technically separate from Telegram, Toncoin’s reputation and future prospects have been closely tied to the messaging platform, contributing to the heightened market volatility.
Telegram has been quick to respond to the situation, asserting that Durov has “nothing to hide” and that the platform adheres to European Union laws. The messaging company described the accusations as absurd, arguing that it should not be held accountable for user activity on the platform. However, the incident has raised concerns about the potential long-term implications for both Telegram and Toncoin.
Richard Galvin, co-founder of the hedge fund DACM, remarked that Durov’s arrest could damage Telegram’s standing in the cryptocurrency space, which would, in turn, weaken Toncoin’s competitive edge. The relationship between Telegram’s vast user base and the cryptocurrency’s growth has been a key factor in Toncoin’s appeal.
In solidarity with Durov, the Toncoin team has voiced their support on social media by joining the #FreePavel movement and changing their logo to a “Resistance Dog” symbol. However, the future of both Telegram and Toncoin remains uncertain amid this developing situation.
