Technical analysis of BNB
From April 17 to June 12, 2023, the value of BNB fell 37%-plus. And more than 27% occurred in just seven days, from June 5 to 12.. Investors were actively getting rid of the cryptocurrency in the wake of a lawsuit that the U.S. Securities and Exchange Commission (SEC) filed against Binance.
Interestingly, all this was accompanied by a positive change in the Open Interest indicator, which shows the total number of futures contracts at the end of the day. Both long and short instruments are taken into account. Their number was growing until June 16, when the figure reached a maximum of $395.52 mln in a month and a half.
Source: coinglass.com
At the same time, the Weighted Funding Rate has been below zero since June 10. So the bears were willing to pay the bulls to leave short positions open.
Source: coinglass.com
There was a situation where the number of futures in BNB was rising and the market was dominated by downside players, which naturally indicated a further decline. Also in favor of the judgment was the fact that the sale of cryptocurrency Binance by major players. Network analyst Lookonchain disclosed that a major player, who has not made any action for two years,
sold 10 000 BNB worth $2.3 million.
And there were also rumors that Binance CEO Changpeng Zhao had personally started
to drain the cryptocurrency.. However, CZ (the pseudonym of the head of the exchange) himself later
Later he denied this information, calling it a manifestation of FUD (fear, uncertainty, doubt).
From the point of view of technical analysis, the picture is ambiguous. On June 12 BNB reached its local low of $220.4. It coincided with the minimum values of December 2022. In other words, the coin came to the level of support. After that, it rebounded and rose nearly 10% (value at the time of writing on Monday, June 19, $242). The nearest target should be the resistance level of $252.8.. At the same time not so long ago a dead cross appeared on the chart, when the faster 50-day moving average (marked in purple) crossed the slower 200-day moving average (marked in green) from the top down. This is usually considered a bearish omen.
Source: tradingview.com
So, as far as the purely value BNB is concerned, negative prevails right now. Is there any positivity in the fundamental aspect?
Luban Update.
The news that a Luban update was coming,
Luban update was announced back in May 2023.
And now, on June 11, the update has been activated. Luban offers three improvements: BEP-126, BEP-174 and BEP-221. Binance Chain itself paid special attention to the first:
<blockquote
“The long-awaited update introduces the Fast Finality mechanism. With Fast Finality, block reorganization is a thing of the past. What does this mean for you? Improved protection against double-spending and MEV reorganization attacks, transaction irreversibility after confirmation, and efficient transactions for exchanges and DeFi-protocols. While BEP-126 does not directly speed up transactions or reduce fees, the update helps maintain the security and reliability of the BNB Chain ecosystem.”
The Fast Finality mechanism is essentially an acceleration of block formation. This is quite useful: users can make sure they get the right information from the last block they finish, and they can decide what to do next.
BEP-174 provides a proposal for better management of internetworking relays. Not so long ago, a white list of repeaters was put into effect. It is proposed to introduce a control mechanism that would be able to register a single repeater. Managers will be selected or removed by the project management. BEP-221 lays the foundation for the next update to CometBFT Light Block Validation, related directly to validation;
Layer 2 blockchain
On June 15, on its official Twitter page, the platform
published a 17-second video on its official Twitter page, in which the BNB Chain team announced that people will soon be able to see the full power of their blockchain. As soon as the second level solution is released. The video says that the Layer 2 solution will increase throughput and also make transaction processing more economical. The solution is already
is already being tested.
More questions than answers so far. There is a lot of speculation about this decision. In the comments to the video on Twitter there are
statements like:
<blockquote
“Good distraction marketing, classic.”
Industry experts suggest that a second-tier solution will cure the scalability problem in the long run. The problem is faced by many. Expected
New solutions for decentralized applications (dApps) and decentralized finance projects (De-Fi).
In other words, life inside Binance Chain continues to boil. Luban update is out, second level blockchain implementation is next. But the price of BNB is in a bearish trend: investors continue to be anxious about the SEC lawsuits against the largest cryptocurrency exchange in the world.
This material and the information in it does not constitute personal or other investment advice. The editorial opinion does not necessarily reflect the views of the author, analytical portals and experts.