Toncoin (TON) User Count Growing But DeFi TVL Dropping: What’s Going On?

In the first half of 2024, Toncoin experienced a surge in value driven by the rise of Hamster Kombat, Notcoin, and other tap-to-earn ecosystems. The prices of TON soared from $2 to $8 by June 2024, pushing the coin into the top 10 cryptocurrencies. However, in August, the coin faced challenges when French authorities detained Pavel Durov, leading to a drop in TON prices.

Despite an impressive bull run in Q4 2024, TON struggled to recover. DeFi activity on the Tonchain network also decreased significantly, with assets managed dropping from $770 million to $170 million within six months. This decline in DeFi activity was accompanied by a decrease in TON prices and growing concerns among holders about the ecosystem’s recovery.

An analyst pointed out that while user participation on Tonchain was increasing, Total Value Locked (TVL) was dropping. Users were withdrawing funds from DeFi dApps due to falling TON prices and shifting their investments to more secure options like staking.

The number of active wallets on the Tonchain network has been steadily increasing over the last six months, but daily active wallets have been decreasing recently. This trend has led to fewer TON being burned from transactions on Tonchain.

Additionally, Tapswap, a prominent DeFi protocol on Tonchain, decided to airdrop tokens on the BNB Chain instead of the original chain, adding selling pressure on TON. Despite these challenges, users remain confident in Tonchain’s stability and are opting for secure investment options like staking.

Overall, while TON faces obstacles such as declining TVL and active wallets, there is still optimism among users about the network’s future growth potential.