The digital asset, which had been trading steadily around $6.80, suddenly dropped to $5.99 as news of Durov's detention circulated among investors.
The cryptocurrency linked to messaging platform Telegram, Toncoin (TON), experienced a sharp 13% decline on Sunday following the arrest of the platform's founder, Pavel Durov, in France.
The digital asset, which had been trading steadily around $6.80, suddenly dropped to $5.99 as news of Durov's detention reached investors. This steep fall highlights the strong connection between the token and Telegram's leadership, despite the project's claims of decentralization.
Durov, 39, was taken into custody on Saturday evening at Paris Le Bourget Airport as he disembarked from a private jet. French authorities have yet to announce the charges against the tech entrepreneur, leaving TON investors in a state of uncertainty.
Toncoin (TON), also known as The Open Network, is a blockchain platform that was initially developed by Telegram. It was designed to enable fast transactions, scalability, and user-friendly decentralized applications.
The platform's native cryptocurrency, Toncoin (TON), serves multiple functions within the ecosystem, including transaction fees and governance. Launched by Telegram in 2018, the project encountered regulatory hurdles that prompted Telegram to officially step back from its development in 2020.
The arrest, which was reportedly carried out by French secret services at around 8 p.m. local time, surprised many in the tech community. According to French media outlet TF1 Info, Durov was accompanied by his bodyguard and a woman during the incident.
The price sensitivity of TON to Durov's legal troubles underscores the broader risks faced by blockchain projects that are closely associated with high-profile individuals. Despite Telegram's efforts to portray TON as an independent ecosystem, the market's response suggests that investors still perceive Durov's involvement as crucial to the token's value.
As the situation continues to unfold, holders of TON face an uncertain future. The limited information available regarding Durov's arrest has fueled speculation about potential regulatory challenges for Telegram and its cryptocurrency projects.
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