- Early in June, BNB saw an 18.6% increase, going from about $600 on June 2 to $700 on June 5.
- There could have been a number of factors that led to the BNB spike.
Last week, both the BNB Chain native token and the Binance exchange token reached a record-breaking high of more than $700.
The token began the year at $312 and surged to over $600 by mid-March, helped by gains in other cryptocurrency markets as well as some encouraging developments for Binance in their post-CZ period.
Recall that Binance and the US Department of Justice reached a $4.3 billion settlement last year, and Changpeng Zhao, the exchange’s former CEO, resigned from his position after entering a guilty plea to charges of money laundering.
Compared to the 36 months that the prosecution had suggested, Zhao’s sentence of four months in prison was quite light.
The exchange’s newly appointed CEO, Richard Teng, has been spearheading the introduction of a new compliance wave. Most recently, the exchange announced that it will limit access to “unauthorized” stablecoins inside the EU in accordance with the Markets in Crypto-Assets Regulation (MiCA).
A portion of the spot market share that Binance lost at the conclusion of the previous year has been regained.
In November 2023, the exchange accounted for a substantial 37.5% of spot volume, which was less than the over 60% of volume it accounted for in February of the same year. Since February of this year, Binance has accounted for at least 44% of monthly spot volume, while not yet reaching its peak levels.
However, in the first three days of June, BNB increased 18.6%, from about $600 on June 2 to $700 on June 5. It appears that no significant news about the exchange or the blockchain was released at the time of this sudden spike.
Numerous reasons could be responsible for the increase in BNB. The popularity of Binance Launchpool could be one factor.
Users can access fresh token offers by holding and staking BNB on the platform. One of the first sites to sell Notcoin, a cryptocurrency linked to a web3 Telegram game that has become extremely popular, was Binance Launchpool.
Others have cited BNB Chain’s sustained popularity, pointing out that it has cheaper costs than Ethereum and is home to one of the most well-known DEXs, PancakeSwap. Increased BNB burns are a result of increased BNB Chain activity, and this can result in favorable price movement.
Some further emphasized the BNB token’s increased leverage, pointing out that from June 1 to June 6, the coin’s futures open interest increased by 1.86 times, hitting $1 billion for the first time on exchanges.
With an 186% increase over the last year, BNB has become the best-performing exchange token. This is probably due to a combination of these factors. However, it is encouraging for Binance as it strives to rebuild its reputation following a somewhat turbulent 2023.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
