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Why Toncoin’s Recovery May Not Be Sustainable – Mixed Signals Emerge
Toncoin (TON) has recently seen a significant price surge, with its value rising by 3.6% in the past day and trading at $6.39 as of writing. However, a closer look at the network’s activity reveals mixed signals that may undermine this recovery.
Historically, Toncoin’s price movements have been closely tied to decentralized exchange (DEX) engagement. A decline in such activity has been correlated with decreasing prices, while increased participation has led to upward trends. Unfortunately, recent data from CryptoQuant suggests a stark contrast to this narrative. The analyst observed a significant drop in swaps and liquidity pool availability on TON’s DEX platforms, including Stone.FI and DeDust.
This decline in decentralized trading and liquidity provision is a concerning sign for Toncoin enthusiasts, as it indicates reduced interest in the cryptocurrency’s derivatives market. With fewer users engaging with the network through these means, it may be challenging to sustain this recovery.
On the other hand, some metrics offer a more optimistic outlook. The Open Interest of Toncoin has increased by 2.77% to $214.07 million, accompanied by a 7.10% rise in the Open Interest volume to $169.73 million, as seen in data from Coinglass. This heightened interest in derivatives trading could be indicative of renewed enthusiasm from traders and investors.
However, another crucial metric tells a different story. According to Glassnode’s statistics, Toncoin’s active addresses have plummeted from 3.8 million in late October to approximately 1 million as of December 15th. This substantial decline suggests that user engagement is dwindling, which could hinder the cryptocurrency’s ability to maintain its current upward momentum.
The contradictory signals emerging from these datasets raise questions about Toncoin’s long-term viability. While the rise in derivatives market interest offers some encouragement, the simultaneous drop in active addresses casts doubt on the sustainability of this recovery.
Source: ambcrypto.com
