April 17, 2024

Despite Drop Rate in Smart Contracts, BNB Price Rallied

The overall market valuation of the cryptocurrency industry on June 30 was worth $860 billion. However, in a five-week period, the valuation has risen by 20.6%, coming up to $1.03 trillion.

The rise in the valuation is due to the rise in the individual market valuation of cryptocurrencies. Among the cryptocurrencies that recorded the highest valuation gains in the same period, it was Binance Coin (BNB) that outperformed the rest.

However, Ether (ETH) was the largest chain for smart contracts in the same five-week period.

YTD Performance of BNB

The YTD performance of BNB shows that it is still in the negative zone. Its value has dipped 43% since the start of the year. Still, it ranks as the third-largest cryptocurrency with a market valuation of $49.5 billion.

Then comes PancakeSwap, which is the leading decentralized application (DApp) in the crypto-verse in the past 7-days. The DApp also runs on the BNB Chain, and it currently has a total of 843,630 active addresses.

Utility of BNB

BNB currently exists as the utility token on the ecosystem offered by the Binance exchange. Many users are able to earn tokens or earn discounts if they continue participating in Binance’s offers.

The US SEC Marches against Binance

Since April 2021, the United States Securities and Exchange Commission (SEC) has been after Binance. It claims that the platform has been offering unwarranted services and securities to the locals.

The regulatory is also enquiring about the initial coin offering (ICO) Binance conducted back in 2017. According to the US SEC, it has reasons to believe that Binance proceeded with the ICO without being registered to offer securities in the US.

In recent days, the US SEC has expedited its process of probing the exchange. Now, the developments are being made into the matter with haste and it is expected that the US SEC wants to inflict damage to the exchange.

Concerns among the Investors

With the recent developments on the Binance exchange matter, the analysts want to know exactly what is going to happen with the token.

In the past 5-weeks, BNB has experienced a 39% rally, which was a strong bullish indication for the investors. However, the latest developments may have a negative outcome for BNB just like it did for XRP.

Smart Contract Deposits’ Downfall

While the trading price of BNB has witnessed a rise in recent days, TVL seems to be telling a different story. It shows that the TVL for BNB continued dropping starting May 2022.

It reportedly fell to 24 million BNB and even the deposits on the BNB Chain witnessed a drop rate of 28%. This drop rate on the BNB Chain was recorded in the past three months.

At the time of writing, it is the lowest deposit rate BNB Chain has recorded since April 2021.

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