Toncoin (TON) Set for a Breakout As Staking Drops and Risk Signals Shine

NAIROBI (CoinChapter.com)— Toncoin (TON) is experiencing market shifts as staking participation drops, open interest declines, and risk metrics signal reduced downside potential.

Staking TVL Ratio Drops Amid Price Fluctuations

Toncoin’s staking TVL ratio, which measures the proportion of assets locked in staking compared to total value locked (TVL), has highlighted a curious trend. When TON’s price rises, staking participation often declines. Analyst Joao Wedson observed this dynamic earlier this year when the staking ratio dropped significantly as TON’s price surged in March 2024.

TON staking ratio declines as price steadies. Credit: CryptoQuant

Investors are prioritizing liquidity, withdrawing assets from staking to enable quick trades on exchanges. This shift has increased activity on platforms like Ston.FI and Dedust. Wedson observed that reduced staking interest aligns with higher market liquidity, driving price momentum.

Currently, TON’s staking TVL ratio has reached a low point again, coinciding with what looks like a local bottom in the token’s price.

Open Interest Signals Reduced Volatility but Opportunity Ahead

Toncoin’s Open Interest (OI) in the futures market has also drawn attention. CryptoQuant analyst Maartunn reported that TON’s OI fell to $141 million recently, the lowest level in nine months. Open Interest reflects the total value of active futures contracts and serves as a key metric for gauging market sentiment and activity.

TON Open Interest hits 9-month low. Source: CryptoQuant

The decline in OI indicates reduced trading activity and lower market volatility. Historically, such periods often precede substantial price movements, either upward or downward, as liquidity reenters the market.

In TON’s case, the combination of low OI and favorable risk metrics, as highlighted by the Normalized Risk Metric (NMR), suggests potential accumulation opportunities.

Wedson’s NMR analysis places Toncoin in a low-risk zone, suggesting limited downside potential. Using historical price data, the metric indicates TON may be in a favorable range for long-term investors. However, Wedson noted the possibility of TON revisiting key support levels before any sustained recovery.

Toncoin’s market behavior underscores a cautious yet strategic shift among investors. Declining staking activity and lower open interest point to short-term liquidity preferences, while favorable risk metrics highlight opportunities for accumulation.