A cryptocurrency heavily endorsed by social media giant Telegram turned out to be a dud in its opening week, leaving investors who bought into the hype with heavy losses.
What Happened: Notcoin NOT/USD debuted on the Toncoin TON/USD network–another project closely linked with Telegram–last week after nearly $1 billion worth of tokens were airdropped to eligible investors, alongside high-profile listings on exchanges like Binance.
Note that Notcoin is a Telegram-based game with an impressive 35 million user base. Users who play the in-app game have the option of converting their currency into NOT.
The project has been promoted by none other than Telegram founder Pavel Durov, who heaped praise for Notcoin on his Telegram Channel. He noted, " We are now seeing a large wave of new mini-apps being built on Telegram and TON. Notcoin used its mighty paws to pave the way for many apps to come."
Price Action: Barring the initial euphoria that saw the crypto gain 30% on its debut on May 16, the price action has disappointed investors. NOT was trading 62% down over the week, according to CoinMarketCap, with double-digit losses in the past 24 hours.
Why It Matters: The price slump happened as most investors immediately resorted to profit-taking after receiving the airdrop rather than holding them for future gains.
This happened despite the project introducing stalking services to restrict users from spending away their coins.
The sharp fall since the hype created last week reflected the topsy-turvy world of cryptocurrencies, which, despite the considerable stability seen in some of its blue-chip assets, remains a very volatile industry.
Image via Shutterstock
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