Crypto Abuse and Your Crypto Investments

So, we thought that a combination of crypto winter, a subsequent storm of crypto regulation and then Bitcoin and Ether spot price ETFs had succeeded in making crypto safe as an investment for ordinary folks. Now we wake up to another case of crypto abuse and a potential threat to your investments in the digital currency world. Such is the case of a $5.9 billion warning to crypto due from the Telegram messaging app and associated Toncoin crypto token.

What Is Telegram and How Is It Associated with Toncoin?

Telegram is a messaging application similar in its use to apps like WhatsApp or Twitter (now X). It currently has about 900,000 users. Telegram touts its alleged increased privacy as opposed to other applications since its inception in 2013. This “vision” became expanded to include digital applications and services based on Toncoin, so named for the Telegram Open Network (TON) as reported by Crypto.com.

Are There Problems with Toncoin?

Analyst1 reports that Toncoin is associated with use in cybercrime. It turns out that a pro-Russian hacker group, KillNet, has been asking for donations in Toncoin. They mostly target NATO countries with Distributed Denial of Service (DDoS) attacks. Although their activities generally align with Russia’s geopolitical interests, it is not clear if there is direct Russian government control or not. Nevertheless, the security conscious Telegram network and its associated crypto token have facilitated illegal and dangerous activity. When the head of Telegram was arrested in France and charges made against him, Telegram and the Toncoin token fell substantially. Thus, crypto abuse can harm your investments made in good faith by folks who are doing questionable things behind the scenes.

Crypto Abuse and Your Crypto Investments

One Year Toncoin Price Courtesy of Coin Gecko

How Do Telegram’s and Toncoin’s Problems Affect Crypto Investors?

As the one year chart of Toncoin’s price shows, anyone who invested in this token a year ago in the $2.50 range has done well as the token currently trades at about $5.50. Anyone who bought at closer to $8 three months ago has taken a beating. With the prospect of the Fed cutting interest rates, many cryptocurrencies are likely to benefit. The only reason for the drop in the value of this investment is the news of Telegram and Toncoin facilitating illicit activities. This fall in price of Toncoin is not a result of supply and demand or of other market forces. The fall is price is more akin to what happened with folks invested in FTX who were devasted by shenanigans going on behind the scenes.

Isn’t Privacy What We Are Looking for With Crypto?

Many perfectly honest folks simply are not interested in someone at their bank, brokerage, or other investment or trading venue having any knowledge of that person’s investments or activities. Thus, many have gravitated to crypto simply because they desire a degree of privacy. Sadly, not everyone who is seeking privacy or secrecy in the crypto world is doing so for legitimate personal reasons. We have written extensively about folks using Bitcoin mixing, crypto scams or pyramid schemes, and such in the investment world at large as well as in the world of cryptocurrencies. Private crypto investors need to be aware of the need to police the crypto world because the results of not doing so are not just that illegal activity flourishes. Rather, folks end up losing substantial assets when perpetrators are caught, pyramid schemes collapse, and hidden debts result in one’s crypto tokens having little or no value just when you believed that you had successfully and safely funded your retirement!

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