The price of TRX, the native cryptocurrency of the Tron network dropped by more than 0% over the last day according to data from CoinMarketCap.
This latest price dip comes after charges against Justin Sun and three of his companies, including BitTorrent and the Tron Foundation, were made public by the Securities and Exchange Commission (SEC).
Sun, however, was not the only one involved in the SEC's allegations including fraud and unregistered securities violations. Separate charges were also filed against the famous investors in his Tronix and BitTorrent assets, including celebrities like Jake Paul, Lindsay Lohan, and Soulja Boy.
According to the charges filed by the SEC, Sun may have committed fraud by faking active trading in theTronix and BitTorrent, while there was, in fact, no such trading going on.
On the other hand, the SEC's accusations of unregistered offer and sale of these tokens are similar to its accusations against other cryptocurrency companies and exchanges, including Genesis, Gemini, and Do Kwon's Terraform Labs.
In a statement, SEC chairperson, Gary Gensler mentioned that when crypto assets and securities are offered and sold without proper disclosure, their investors are at high levels of risk.
He continued, saying that Sun coordinated a promotional campaign in which he and his celebrity promoters shilled these tokens while hiding the fact that the celebrities were paid for their tweets.
The Gensler and the SEC also alleged that Sun may have paid social media influencers with millions of followers to promote the unregistered products while particularly asking them to keep the fact that they were paid a secret.
Some of these celebrities include well-known ones like NeYo, Akon, Lil Yachty, Kendra Lust, Jake Paul and Lindsay Lohan, all of whom except for Austin Mahone and Soulja Boy have agreed to pay a collective $400,000 as a penalty.
Sun, in response to these allegations, chose to first calm the crypto community on Twitter, criticizing the SEC's most recent action and directly implying that the SEC's allegations lacked "merit."
Additionally, Sun mentioned in his tweets, that the SEC's present regulatory system, "is still in its infancy".
The American government's position on the crypto-verse has frequently been called into question, Sun said.
He also mentioned that Investors have consistently suffered because regulators lack clarity. And in the middle of this, the SEC keeps coming after businesses in the digital asset sector.
In conclusion, Sun also emphasized Dominica's recent TRX adoption, bringing up Tron's "eagerness to engage with governments and regulatory agencies,".
The crypto market at the moment isn't as strong as it was last week. However, TRX, especially, has taken an even harder hit.
According to CoinMarketCap, the cryptocurrency is down by 6.5% over the last week, and by 7.6% over the last 24 hours at the time of writing.
This suggests that the larger part of Tron's dip happened today.
CoinMarketCap also shows that the cryptocurrency hit a $0.6812 high in the last 24 hours, before the sudden dip that took it a whole 13% to where it now sits at $0.6209.
Zooming into the 15-minute timeframe on the TRX/USDT pair as illustrated above, we have a clearer picture of what might have happened.
As illustrated above, the dip on Tron took an average of one hour. By this definition, the $TRX dip qualifies as a flash dip and appears to now be in the middle of a correction.
As expected, the RSI on the hour chart entered the oversold zone as investors rushed to take profit and pull their funds out.
The RSI on the 1-hour chart has now gravitated towards the neutral zone and sits on the 46.8 level.
On the daily chart, however, the impact of this dip appears to have minimal effect on Tron's outlook.
In fact, the long-term outlook on cryptocurrency appears promising.
As illustrated above, TRX appears to be in an ascending channel. The dip over the last 24 hours, on the other hand, may have only brought the cryptocurrency into a retest and rebounded off the lower support.
The RSI is hinting at a crossover between the signal line and the RSI-based MACD, indicating that the bulls may be gearing up for a full takeover.
If all goes well and the price of TRX continues upward, it may be in for a 24.85% move to the upside from where it currently sits, to the top of the channel around $0.075.
Conversely, TRX may be in for a strong dip if the bears win and manage to push the price below $0.054.
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