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Wednesday, June 12, 2024
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BNB drops to $600 after hitting new all-time high, but remains best exchange coin of the year

BNB Chain’s BNB hit an all-time high above $700 last week.

The token stood at $312 at the start of the year but rose above $600 by mid-March, fueled by a broader crypto market rally and some positive progress for Binance in the post-CZ era.

To recall, Binance settled with the US Department of Justice for $4.3 billion last year and its former CEO, Changpeng Zhao, pleaded guilty to anti-money laundering violations and resigned. Zhao was sentenced to four months in prison, quite short of the 36 months that prosecutors had proposed.

Under the leadership of new CEO Richard Teng, the exchange has brought in a new wave of compliance, most recently announcing it will restrict access to stablecoins that are “unauthorized” in the EU under the Markets Regulations Crypto Assets (MiCA).

Binance has recovered some of the spot trading market share it lost late last year. The exchange still accounted for 37.5% of spot trading volume in November 2023, but was down from more than 60% in February of that year. While not yet at its peak, Binance has accounted for at least 44% of monthly spot trading volume since February this year.

However, BNB increased 18.6% in just the first three days of June, climbing from around $600 on June 2 to $700 on June 5. This surge appears to have occurred without any major news. related to the exchange or BNB Chain.

There are several potential causes for BNB’s surge. The popularity of Binance Launchpool may be a factor. The platform allows users to hold and stake BNB to access new token issuances. Binance Launchpool is one of the first to offer Notcoin, a token related to the popular web3 game Telegram.

Some also point to the continued growth of BNB Chain, which is home to PancakeSwap, one of the most popular DEXs and with lower fees than Ethereum. More activity on the BNB Chain also leads to more BNB burning, which could lead to a positive impact on the price.

Additionally, the increase in leverage for the BNB token was also highlighted, with open futures contracts on exchanges for the coin reaching $1 billion for the first time in early June, an increase of 1.86 times from the 1st. until June 6.

It is perhaps the combination of these factors that has made BNB the best-performing exchange coin of the past year, up 186%. This is a good sign for Binance as they continue to reestablish their position after a turbulent 2023.

You can see coin prices here.

Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

Jia Bao Ngoc

According to The Block

Mark Tyson
Mark Tyson
Freelance News Writer. Always interested in the way in which technology can change people's lives, and that is why I also advise individuals and companies when it comes to adopting all the advances in Apple devices and services.
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