Toncoin rebounds 3.5% to $6.60 amid diminishing network activity

Toncoin’s price has bounced back, increasing by 3.5% to reach $6.60. This recovery follows a dip below $6.50 showing a 9.5% decrease over the week. At the same time, data from on-chain sources indicates a reduction in TON network activity paired with an uptick in speculative trading.

On August 5th, TON emerged as one of the top gainers alongside Litecoin and XRP after a market crash. While XRP’s surge was linked to a court ruling in the Ripple vs. SEC case, TON’s price benefited from Russia’s law legalizing crypto mining introduced on August 8th. This legislation also had positive effects on other  Proof of Work (PoW) cryptocurrencies like Litecoin and Bitcoin.

Russia’s crypto mining law influences Toncoin’s price surge

Toncoin’s price performance was notably strong due to its ties to the Russian market. After a volatile start to August, with the price falling to its lowest in three months at $4.78 on August 5, the cryptocurrency saw a recovery, reaching $7.10 by August 19.

Short-term traders who purchased TON during the early August dip are now realizing profits. On August 22, Toncoin’s price fell below $6.50, following four consecutive days of losses and marking a 9.5% retracement since August 18. The inability to surpass the $7.50 resistance level has dampened bullish momentum.

Toncoin network activity declines by 40%

During the 48% rebound from the August 5 lows, bulls dominated the TONUSD price action. However, the focus has increasingly shifted toward speculative trading at the expense of fundamental network activity.

Data IntoTheBlock shows that Toncoin network fees dropped from 15,650 TON on August 14 to 9,500 TON as of August 21, marking a 40% decline.

The Bollinger Bands also show that TON is trading near the lower band.  The key resistance levels are $7.22 and $7.50, while critical support levels are $6.34 and $5.96.