Toncoin (TON), the native token of The Open Network blockchain, has fallen by 7.9% over the past 24 hours, reaching $3.4, according to CoinGecko. At the time of writing, the project’s market capitalization stands at $8.1 billion.
Reason for the decline
The drop in price followed a high-profile announcement by Verb Technology, a Nasdaq-listed public company, about its plans to make TON its primary reserve asset. As part of its rebranding strategy, the company will change its name to TON Strategy and aims to raise $558 million through a private placement.
Most of the raised capital, excluding the cash reserve, will be allocated to purchasing Toncoin and staking it to generate yield. According to company estimates, the amount of TON in its reserves will account for about 5% of the current circulating supply.
Who is investing
The investment round was led by Kingsway Capital, with participation from key crypto industry players including Blockchain.com, Vy Capital, Ribbit Capital, Graticule, Pantera, ParaFi, Animoca Brands, and others.
77% of the raised funds will remain in liquid cash assets, allowing the company to maintain a balance between cryptocurrency and fiat reserves.
New management team
The project also announced significant leadership changes:
- Executive Chairman — Manuel Stotz, CEO of Kingsway Capital and President of TON Foundation.
- Special Advisor — Peter Smith, CEO of Blockchain.com.
- Chief Executive Officer — Veronika Kapustina, former advisor to TON Foundation.
- Chief Financial Officer — Sarah Olsen, former JPMorgan executive.
Context
Interest in Toncoin has surged in 2024 due to its integration with Telegram and the launch of several ecosystem services. However, the news of large reserves being held by a public company was met with mixed reactions from the market, with investors likely concerned about potential price pressure in the event of large-scale operations with the token.
Previously, in July, TON was involved in a controversy after announcing a “golden visa” program in the UAE for staking Toncoin. The country’s authorities denied any connection to the initiative, and TON Foundation later clarified that it was a private program unrelated to government bodies.
