The cryptocurrency market has experienced a cooling-off period over the past month, with overall trading activity declining and global market capitalization dropping by 4%. Amid this broader pullback, many digital assets have suffered double-digit losses—yet Toncoin (TON) has defied the trend.
Currently trading at $7.93, Toncoin has surged 24% in the past 30 days, outperforming most major cryptocurrencies. While this rally reflects growing investor interest, on-chain data suggests the momentum may not be sustainable. Several key indicators are flashing warning signs of overheating, hinting at a potential correction in the near term.
Signs of Buyer Exhaustion in Toncoin’s Rally
A deeper look at Toncoin’s on-chain metrics reveals a concerning divergence between price action and actual network usage. One of the most telling indicators is the Price-Daily Active Address (DAA) Divergence.
This metric compares the movement of an asset’s price with changes in its daily active addresses—essentially measuring whether price growth is backed by real user engagement. When price rises significantly faster than active usage, it often signals speculative behavior rather than organic adoption.
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As of now, TON’s Price-DAA Divergence stands at 281.15%—a historically high level. This means that while the price has skyrocketed, the number of daily users interacting with the TON blockchain has not kept pace. Such a wide gap suggests that much of the recent price surge may be driven by speculation rather than fundamental demand.
When this kind of divergence occurs, it often precedes a market correction, as prices eventually realign with actual network activity.
Market Value vs. Realized Value: Is Toncoin Overvalued?
Another critical indicator pointing to overvaluation is Toncoin’s Market Value to Realized Value (MVRV) ratio, which currently sits at 59.18%.
The MVRV ratio compares an asset’s current market price to the average acquisition cost of all existing coins. A ratio above 100% typically indicates that holders are, on average, in profit—and often marks a zone where profit-taking becomes more likely.
While TON’s MVRV is below 100%, its upward trajectory into the 59% range suggests increasing frothiness in the market. Historically, when MVRV approaches or exceeds 60%, especially during rapid price climbs, it has preceded pullbacks as early investors lock in gains.
This doesn’t mean a crash is imminent, but it does signal that the market is entering a high-risk, high-reward phase where sentiment drives price more than fundamentals.
Chaikin Money Flow Signals Waning Buying Pressure
Technical analysis further supports the case for caution. The Chaikin Money Flow (CMF) indicator for Toncoin has been trending downward since June 15—even as the price continued to climb.
CMF measures the flow of money into and out of an asset over a given period. A falling CMF during a price uptrend creates what’s known as a bearish divergence—a situation where price gains are not supported by increasing buying volume.
In practical terms, this means fewer new buyers are stepping in to sustain the rally. Instead, the upward movement may be fueled by reduced selling pressure or short-term momentum trading rather than strong accumulation.
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If this trend continues, analysts suggest that TON could see a correction down to $7.70—a roughly 3% drop from current levels. This would represent a healthy pullback, potentially retesting support before any further upside.
Potential Upside if Demand Returns
Despite the overheated signals, Toncoin isn’t without bullish potential. The project continues to benefit from strong integration with Telegram, one of the world’s most popular messaging platforms, which provides a massive built-in user base.
If network activity picks up—such as increased use of TON-based mini-apps, wallets, or decentralized services—the current divergence could resolve itself organically. In that scenario, renewed demand could push TON’s price toward $8.28, marking another 4.4% gain from current levels.
However, reaching that target would require not just price momentum but verifiable growth in active users and transaction volume—something yet to materialize.
Frequently Asked Questions (FAQ)
Q: Why is Toncoin rising while most cryptocurrencies are falling?
A: Toncoin’s recent gains are likely due to its unique ecosystem ties with Telegram, which drives user adoption and speculative interest. Additionally, positive developments like expanded use cases and increased visibility contribute to its resilience during broader market downturns.
Q: What does a high Price-DAA Divergence mean for TON?
A: A high divergence means price growth is outpacing real user activity. This often indicates speculation and can precede corrections when traders take profits or momentum fades.
Q: Is Toncoin overvalued right now?
A: While not severely overvalued, TON’s MVRV ratio of 59.18% suggests it’s approaching a zone where profit-taking becomes more common. Combined with weak money flow, this increases short-term correction risks.
Q: What is bearish divergence in CMF?
A: Bearish divergence occurs when price rises but CMF falls, indicating weakening buying pressure. It’s often a precursor to a reversal or consolidation phase.
Q: What could drive TON higher in the future?
A: Sustained growth in daily active addresses, increased app usage on the TON platform, and deeper Telegram integration could justify higher prices and attract long-term investors.
Q: Should I sell TON now?
A: This article does not provide financial advice. However, given current overheat signals, traders may consider risk management strategies such as taking partial profits or setting stop-loss orders.
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Final Thoughts: Proceed with Caution
Toncoin’s recent performance showcases its growing prominence in the crypto ecosystem—especially within Telegram’s expanding Web3 initiatives. However, the current rally appears increasingly disconnected from underlying network fundamentals.
With key indicators like Price-DAA Divergence, MVRV, and Chaikin Money Flow all suggesting overheating or weakening momentum, investors should remain cautious. While upside potential exists, the path forward is likely to be volatile.
For traders and long-term holders alike, monitoring on-chain activity and volume trends will be crucial in determining whether TON’s rally can continue—or if a correction is just around the corner.
This article is for informational purposes only and does not constitute financial or investment advice. Always conduct your own research and consult with a qualified professional before making investment decisions.