Here’s how and why Toncoin’s [TON] Open Interest hit record highs

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Open Interest in Toncoin grew materially over the last few weeks
Network growth dipped, indicating a decline in the interest shown by new addresses

Toncoin [TON] has been one of the market’s few successes over the last few months, with TON not particularly affected by the market’s volatility and its bearish sentiment. Hence, it’s worth looking at what spurred such success and the scale of the interest in Toncoin.

A peek into TON’s interest

TON has seen a remarkable surge in value lately, hitting a new all-time high of over $8.20 in mid-June – A milestone unmatched by most other altcoins since the bull run of 2021. Much of the heightened interest in TON over the past year can be attributed to its close association with Telegram – A messaging app that boasts a staggering user base of over 1 billion.

Source: Kaiko

The token’s trading activity has also seen significant growth. Both dollar and asset-denominated trade volumes have risen substantially, indicating a significant uptick in demand for TON beyond price-driven speculation. Along with that, TON’s liquidity has expanded dramatically too, with its 1% market depth soaring from $2.5 million in January to a massive $8 million by July.

This market activity can be further showcased by TON’s Open Interest hitting a record high of $287 million in early July, signifying major capital inflows into the token. Funding rates have exhibited volatility, fluctuating between positive and negative territory throughout the year. This can be interpreted as traders having both bullish and bearish sentiments.

While May saw a pronounced bearish bias, as indicated by heavily negative funding rates, recent months have been more balanced with both long and short positions being taken.

Source: X

The combination of its high price, increased trading volume, and growing liquidity can draw the attention of both retail and institutional investors. This might soon lead to a broader investor base and potentially higher demand for TON.

What does the on-chain data say?

At press time, TON was trading at $7.36 and its price had appreciated by 0.12% in the last 24 hours.

It’s worth noting, however, that AMBCrypto’s analysis of Santiment’s data revealed that the network growth for TON declined. This implied that the interest showed by new addresses for TON has significantly fallen of late.

Read Toncoin (TON) Price prediction 2024-25

The velocity at which TON was trading also decreased, indicating that the frequency at which TON was trading fell materially.

These factors, together, suggest that there could be some sideways movement expected from TON in the short term, before massive price changes happen.