The cryptocurrency market has been experiencing significant volatility lately, and one coin that has felt the brunt of this downturn is Toncoin (TON). According to recent data, a staggering 96% of Toncoin holders are currently facing losses, a situation that has raised concerns about the overall health of the project and its long-term outlook. As prices remain near their recent lows, investors are left wondering whether a recovery is possible and what might be next for the coin.

A Massive Loss for Toncoin Holders

Toncoin’s current slump has left the vast majority of its holders “underwater,” meaning their investments are now worth less than when they originally bought in. Data from blockchain analytics platform IntoTheBlock paints a grim picture of the situation: approximately 96% of Toncoin holders are in the red. This highlights just how severe the ongoing price decline has been for those holding the digital asset.

One of the key indicators showing this negative trend is the MVRV (Market Value to Realized Value) ratio, which tracks the difference between the price at which assets were purchased and their current market value. As of now, the MVRV 30-day ratio for Toncoin is at -10.15%, meaning that most holders are sitting on unrealized losses. This persistent downturn in price suggests that Toncoin has been in negative territory for a long period, and it is unclear when, or if, it will bounce back.

Declining On-Chain Activity Raises Alarm

In addition to the price drop, there has been a notable decline in on-chain activity. The number of active daily addresses interacting with Toncoin has sharply decreased, signaling waning interest in the cryptocurrency. This decline in activity corresponds with the price slump, reinforcing the idea that investor sentiment is low.

Despite the continued price struggles, the number of new addresses being created has also shown minimal growth. This trend further suggests that new investment is weak, and confidence in Toncoin may be diminishing. When combined with the dismal MVRV readings, it paints a picture of a market that is far from bullish at this stage.

Toncoin Price Struggles to Break Key Resistance Levels

Toncoin’s price has been stuck in a prolonged downtrend, failing to regain its previous highs. At the time of writing, Toncoin was trading at around $2.80, which is far below its recent highs. The cryptocurrency has faced consistent rejection at the $3.24 resistance level, which aligns closely with the 50-day moving average. If Toncoin fails to break above this level, it may continue to experience downward pressure, with the next key support level appearing to be around $2.50.

This lack of upward momentum raises concerns among investors, many of whom are closely monitoring whether Toncoin can manage to find any stability. If the cryptocurrency continues to struggle below key resistance levels, there is a risk that the price could fall even further, potentially causing more pain for those already holding losses.

Could There Be a Short-Term Bounce?

Despite the bearish outlook, there are some signs of hope for Toncoin in the short term. Technical indicators such as the Relative Strength Index (RSI) are showing that the cryptocurrency may be nearing oversold conditions. The RSI currently sits at 42.06, which suggests that the asset could be approaching a price level where it may become undervalued in the short term.

If buyers step in and the market experiences a small recovery, Toncoin could see a short-term rebound, potentially pushing its price back towards the $3.00 to $3.25 range. However, unless there is a significant change in market sentiment, this rebound could be temporary, and Toncoin may face further declines after such a bounce.

What’s Next for Toncoin?

The future of Toncoin largely depends on how the broader cryptocurrency market evolves in the coming months. For Toncoin to recover, a shift in market sentiment will be necessary. The current lack of bullish momentum, combined with low MVRV readings, suggests that accumulation may still be in progress, and investors are hesitant to make large bets.

For a sustainable recovery to take place, Toncoin would need to reclaim key support levels and witness an uptick in on-chain activity. If the number of active addresses increases and there is renewed demand for Toncoin, the cryptocurrency could eventually move toward a more solid recovery. However, until these indicators improve, investors should proceed with caution.

Investors Remain Cautious Amid Selling Pressure

Given that nearly all Toncoin holders are currently underwater, selling pressure could remain a persistent concern for the coin’s price in the short term. Many holders may be reluctant to sell at a loss, but continued negative sentiment could lead to further price declines unless a significant catalyst emerges to reignite demand in the market.

In conclusion, Toncoin faces a challenging road ahead. With a majority of holders sitting on substantial losses, a recovery seems uncertain unless market conditions change dramatically. For now, investors will need to watch closely for signs of a potential rebound and be prepared for the possibility that further losses could be on the horizon.