One of Ethereum’s ( ETH ) big-cap rivals could be in danger of a major selloff. Toncoin ( TON ) could be in for some tough weeks after a new announcement that messaging platform Telegram will share user data with governments under certain circumstances.
Telegram originally developed Toncoin in 2018, but parted ways with the project in 2020 after a lawsuit with the U.S. Securities and Exchange Commission (SEC). That same year, Open Network, an open-source community of developers, took over the technology.
However, Telegram's 900 million users can still send TON tokens within the platform without entering long wallet addresses.
Pavel Durov, the founder and CEO of Telegram, was arrested by French authorities last month on a warrant related to his platform’s alleged failure to moderate content related to drugs, fraud and other criminal activity, a move condemned by numerous prominent free speech advocates.
On Monday, Durov announced on Telegram that his platform was updating its terms of service and privacy policy.
“We have made it clear that the IP addresses and phone numbers of those who violate our rules may be disclosed to the relevant authorities in response to valid legal requests.
These measures should deter criminals. Telegram Search is designed to find friends and news, not to promote illegal goods. We will not allow attackers to compromise the integrity of our platform for almost a billion users."
Telegram's 'most attractive feature' being dropped could lead to a Toncoin sell-off.
TON's chart could "repeat the path" of modular layer-1 blockchain Celestia (TIA), which crashed from highs of over $20 in February to lows of under $4 this month.
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