Toncoin (TON) Price Rallies 380% leapfrogging Avalanche (AVAX) into Top 10 Status

Toncoin (TON) price grazed the $5.50 mark on April 5, bringing its total market capitalization above $18.9 billion. The move saw TON assert market dominance, by overtaking Avalanche (AVAX) to become the 10th largest cryptocurrency.

With leveraged positions trending at neutral levels, what are chances of TON price hitting new all-time highs above $6?

Price History: How TON became 10th largest Cryptocurrency

Toncoin is native cryptocurrency on the TON Layer-1 blockchain network. It used for facilitating network operations, paying for transactions, games or collectibles built on TON.

In recent months TON has made giant strides and attracted investors’ attention thanks to the boom in the demand Telegram bot-trading and other social trading projects hosted on the blockchain.

As seen below, the Toncoin price boom began around September 2023, after the  TON team a digital wallet on Telegram’s popular messaging app. The announcement was made during the Token2049 conference in Singapore.

Before the close of September, TON grew by 130% overtaking Justin Sun’s Tron (TRX) network in the process.

More recently, the rally entered second-gear in March 2024, as Telegram Founder Pavel Durov announced a new financial reward system for channel owners using the TON cryptocurrency in March.

This means that Telegram users can now purchase advertisements using Toncoin, and channel owners will receive 50% of advertising revenue.

Also in March, Durov reported that Telegram had received a preliminary valuation of “$30 billion or more” ahead of a potential IPO, and crypto exchange Binance announced the launch of a perpetual futures contract for Toncoin.

Investors front-running the positive impact of the IPO, as well as the Binance futures market launch, has helped attract fresh capital inflows in the April 2024.

At the time of writing on April 6, Toncoin has grown 384% from September 2023, and now has a market cap of $18.8 billion, overtaking Avalanche by almost $1.1 billion.

Bulls remain Cautions despite 380% rally

The utility boost, and financial rewards from TON’s integration into the Telegram social media platform in March 2024 gave impetus to TON’s parabolic rise to become the 10th largest cryptocurrency.

But despite having grown 380% between September 2023 and April 2024, on-chain data shows that TON bulls continue to maintain a cautious approach.

Coinglass’ funding rate metric monitors fees paid by long and short traders to keep futures market prices anchored to the spot prices. It essentially tracks the degree of leverage that existing traders are willing to apply on their active positions.

Toncoin funding rate has remained within 0.013% and 0.018% between April 2 and April 6, despite prices climbing 15% during that period.

Typically, when funding rate remains flat during a price surge, its suggests that the rally is being primarily driven by organic market demand rather than speculative trading.

More importantly, it also means that majority of traders are taking on hedge positions, a move that could see the price avoid major fluctuations in the coming days.

Hedging strategies, such as taking opposing positions in futures contracts or options, can help traders protect their capital against adverse price movements while still allowing them to participate in potential gains.

The prevalence of hedging activity in this scenario may TON contribute to market stability, reducing the likelihood of sharp price fluctuations in the near term.

TON Price Forecast: $6 target in focus

Toncoin price appears on course to break above $6 in the days ahead, given the neutral funding rate trends and organic surge in demand from Toncoin’s recent  rewards-based integration with the Telegram social network.

However, IntoTheBlock’s in/out of the money data, which groups existing TON holders according to their entry prices, shows the bulls could face stiff resistance at the $5.52 territory.

As seen above, 197 addresses had acquired 130,000 TON at the average price of $5.52. If the bulls can mount a steady support base above that critical price levels, Toncoin price could advance to new all-time highs above $6.

But in the event of a sharp market downturn, the $4.53 area could the vital support level to watch.