Binance under pressure
The cryptocurrency world is often notorious for its volatility and uncertainty. Amidst this volatility stands with Binance. The world’s largest cryptocurrency exchange, under increased pressure from regulators worldwide. This has led to speculation as to how this situation could affect Binance Coin (BNB). BNB is the native cryptocurrency of the exchange. In this article, we will highlight the recent developments surrounding Binance and their impact on the BNB price in technical analysis.
Crypto exchange Binance faces regulatory backlash across the globe
Binance has experienced a number of regulatory challenges in recent times . The U.S. Securities and Exchange Commission (SEC) has sued Binance and its CEO Changpeng Zhao for alleged violations of U.S. laws. Binance denies these allegations and has announced that it will vigorously defend itself. Furthermore, the German Federal Financial Supervisory Authority (BaFin) has rejected Binance’s license for cryptocurrencies . These developments have led to increased uncertainty among Binance users and could impact the BNB price.
Binance’s regulatory challenges are not limited to the US and Germany. In Nigeria, Binance has been ruled illegal by the country’s Securities and Exchange Commission (SEC) . Binance.US, Binance’s US subsidiary, has also laid off employees following SEC charges . These global regulatory challenges could result in some users migrating from Binance, which could negatively impact demand for BNB.
Despite these challenges, Binance has seen some positive developments. For example, the company has announced that it will swap 750 million pairs of Tether-Tron for Tether-Ether to boost the liquidity of the stablecoins . Furthermore, Binance has reiterated that it has not sold any bitcoin or Binance Coin, which may boost confidence in BNB’s stability .
Strong decline in Binance Smart Chain Total Value Locked (TVL).
Total Value Locked (TVL) is a key indicator in the DeFi world that measures the total value of all crypto assets locked in a specific protocol or platform. It is a measure of the liquidity available in a DeFi protocol and can serve as an indicator of popularity or trust in a particular protocol or platform.
According to data from DefiLlama , the Binance Smart Chain (BSC) has seen a significant decrease in Total Value Locked (TVL) over the course of 2021 and 2023 . In 2021, BSC’s TVL was still an impressive 20%, but fell to 10% in early 2023 and has since halved again. This drop may be due to a number of factors, including regulatory challenges and a general decline in trust in the platform.
Current technical analysis of the BNB price
Since the beginning of 2023, the Binance Coin (BNB) has been in a price range between 220 and 350 US dollars. Since April of this year in particular, however, the BNB price has lost more than 35% in value . After bouncing off the $240 support, the price appears to be stabilizing again.
An important indicator that is often used in technical analysis is average prices . In the course of the downward movements of BNB, a so-called “death cross” was recently created in the chart. This occurs when the short-term moving average (in this case, the 50-day moving average) falls below the long-term moving average (in this case, the 200-day moving average). Such a “death cross” has recently appeared on the BNB chart and is often interpreted as a bearish signal.
In summary, it can be said that the technical picture for BNB is currently rather negative . However, the crucial support at 230 US dollars has been held so far. What matters now is whether BNB can regain strength from this level and gradually build up the price. However, if the support breaks, further losses could follow.
Conclusion and forecast for the Binance Coin (BNB) course
Binance’s recent regulatory challenges could have a short-term impact on the BNB price. However, it is important to note that cryptocurrencies are inherently volatile and many factors can affect their price. In the long term, Binance’s ability to overcome these challenges and maintain the trust of its users could be critical to BNB’s performance. It remains to be seen how the situation will develop and what further impact it will have on the Binance Coin price.
