Binance Coin Slides Under $220 – What Comes Next After Consolidation?

Christian Encila

1 year ago

3 mins read

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Binance Coin (BNB) faced a weekend of market indecision, leading the altcoin into a range-trading scenario. The coin, which had dropped below the $220 mark on August 18, experienced fluctuations between the narrow range of $213 to $220 over the course of the weekend.

As of the latest update, CoinGecko reported the current BNB price at $216, marking a 0.3% decline over the past 24 hours and a significant seven-day slump of 10%.

Binance Coin (BNB) price action today. Source: Coingecko

The past year has been marked by significant challenges for BNB, largely attributed to the regulatory uncertainties surrounding its parent company, Binance.

The situation escalated in June when the US Securities and Exchange Commission categorized BNB and its sibling token, Binance USD (BUSD) stablecoin, as securities within the context of its lawsuit against the cryptocurrency exchange.

Despite vehement opposition from Binance and the exchange’s chief, the impact on BNB’s demand has been evident, with cautious investors steering clear of assets entangled in regulatory ambiguities.

Binance Coin Market Dynamics And CEO’s Stance

Binance CEO Changpeng “CZ” Zhao recently took to the social media platform X (formerly Twitter) to address growing speculation that Binance was proactively shoring up BNB’s price to prevent it from dipping below $212.

CZ refuted these claims, asserting that BNB’s price was, in fact, shaped by market forces. He challenged the notion of artificial price support and emphasized that the coin’s valuation was ultimately determined by its interaction with the open market.

This declaration marked an attempt to alleviate concerns that the exchange was manipulating the token’s price.

And where did the $212 magic number come from? #BNB price is determined by the market. A $30m re-buy is less than 4% of a single day’s volume. 🤷‍♂️

— CZ 🔶 Binance (@cz_binance) August 19, 2023

On-Chain Activity And DeFi’s Influence

The decline in BNB’s price can also be attributed to diminished on-chain activity on the Binance Smart Chain, a prominent layer1 smart contract blockchain. Decentralized Finance (DeFi) activities have experienced a significant contraction, with the weekly exchange volume plummeting from its peak of $24.70 billion to a mere $2.34 billion, as per DeFillama data.

Source: Defillama

Moreover, the total value of assets within the Binance Smart Chain ecosystem has dwindled by a staggering 87%, now resting at $2.84 billion, according to DeFillama’s statistics.

Binance Coin: Navigating The Crossroads

As BNB navigates these uncertain waters, traders and investors remain at a crossroads, carefully assessing the potential for regulatory clarity, market dynamics, and the revitalization of on-chain activities to influence the coin’s trajectory.

BNB market cap currently at $33 billion. Chart: TradingView.com

The weekend’s range trading and the response from Binance’s CEO underscore the complexities of BNB’s journey, as it strives to regain its footing amidst a landscape marked by challenges and opportunities.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from Siam Blockchain

Christian Encila

They say journalists never truly clock out. But for Christian, that's not just a metaphor, it's a lifestyle. By day, he navigates the ever-shifting tides of the cryptocurrency market, wielding words like a seasoned editor and crafting articles that decipher the jargon for the masses. When the PC goes on hibernate mode, however, his pursuits take a more mechanical (and sometimes philosophical) turn.

Christian's journey with the written word began long before the age of Bitcoin. In the hallowed halls of academia, he honed his craft as a feature writer for his college paper. This early love for storytelling paved the way for a successful stint as an editor at a data engineering firm, where his first-month essay win funded a months-long supply of doggie and kitty treats – a testament to his dedication to his furry companions (more on that later).

Christian then roamed the world of journalism, working at newspapers in Canada and even South Korea. He finally settled down at a local news giant in his hometown in the Philippines for a decade, becoming a total news junkie. But then, something new caught his eye: cryptocurrency. It was like a treasure hunt mixed with storytelling - right up his alley!

So, he landed a killer gig at NewsBTC, where he's one of the go-to guys for all things crypto. He breaks down this confusing stuff into bite-sized pieces, making it easy for anyone to understand (he salutes his management team for teaching him this skill).

Think Christian's all work and no play? Not a chance! When he's not at his computer, you'll find him indulging his passion for motorbikes. A true gearhead, Christian loves tinkering with his bike and savoring the joy of the open road on his 320-cc Yamaha R3. Once a speed demon who hit 120mph (a feat he vowed never to repeat), he now prefers leisurely rides along the coast, enjoying the wind in his thinning hair.

Speaking of chill, Christian's got a crew of furry friends waiting for him at home. Two cats and a dog. He swears cats are way smarter than dogs (sorry, Grizzly), but he adores them all anyway. Apparently, watching his pets just chillin’ helps him analyze and write meticulously formatted articles even better.

Here's the thing about this guy: He works a lot, but he keeps himself fueled by enough coffee to make it through the day - and some seriously delicious (Filipino) food. He says a delectable meal is the secret ingredient to a killer article. And after a long day of crypto crusading, he unwinds with some rum (mixed with milk) while watching slapstick movies.

Looking ahead, Christian sees a bright future with NewsBTC. He says he sees himself privileged to be part of an awesome organization, sharing his expertise and passion with a community he values, and fellow editors - and bosses - he deeply respects.

So, the next time you tread into the world of cryptocurrency, remember the man behind the words – the crypto crusader, the grease monkey, and the feline philosopher, all rolled into one.

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