Immediately after Changpeng Zhao resigned as CEO of the crypto exchange and admitted to money laundering violations, the price of Binance’s own coin fell by almost 10% in the previous 24 hours.
It is also reported that after a dialog between representatives of the site and the U.S. Department of Justice, about $1 billion was withdrawn from the crypto exchange. This led to the fact that the price of the BNB asset has fallen sharply and at the time of writing is $226. At the same time, the token lost almost 9% of its value during the week.
Analysts believe that the situation can still stabilize. Most likely, the position of the BNB token will be influenced by the agreement between Binance and the U.S. Department of Justice, as well as a new employee – Richard Teng – as CEO. In addition, it is reported that the cryptocurrency exchange has to pay $4.3 billion to the Department as part of the agreement.
Will BNB rise in value or fall in value amid Changpeng Zhao’s resignation
On the eve of last evening, the coin experienced a sharp decline in value and is currently continuing to fall in price. However, according to experts, the asset does not lose the desire to regain its former positions.
As can be traced on the chart, the relative strength index (purple line) began moving to the mark of 50 after reaching the level of 40 a day earlier. Such dynamics suggests that traders are probably buying the dip – they start trading following the short-term decline in the price of the asset.
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Source: TradingView
Also, the 30-day moving average (yellow line) has leveled off after tending to the 200-day average (blue) for several weeks. This too indicates that yesterday’s events have disrupted the coin’s previous momentum.
You can see on the chart: the altcoin’s support level (green line) has declined sharply over the past 24 hours. This can also be considered one of the strongest signs of a bearish trend in the market.
Now traders and investors around the world are in a waiting game: whether the asset will be able to prevent a further fall below the $225 mark.
Interestingly, against the backdrop of recent developments, BNB’s trading volume remains at a fairly high level. A few weeks before it was located at $1 billion, but now it has risen to almost $3 billion.
This indicates that the demand for BNB is not decreasing, even if the token becomes cheaper. We can conclude: most likely, we should not expect a strong fall of the coin.
As mentioned above, the reason for the decline was a court case, during which Binance recognized a number of offenses committed by it. Now the company must pay over $4 billion to the regulator, and Changpeng Zhao left the post of CEO. At the same time, the entrepreneur was issued a personal fine of $50 million.
However, how will this affect the company itself, which continues to face lawsuits from the CFTC (Commodity Futures Trading Commission) and SEC? Experts assume that the current situation may lead to an outflow of clients and further decline in the value of BNB.
For this reason, the maximum that the asset will be able to reach in the near future is the price of $245.
A new project with strong fundamentals and great prospects
Although BNB is able to recover from the fall already in the coming weeks, many traders may still feel uncomfortable. For them, buying the token will be associated with possible risks.
Therefore, investors will start looking for a favorable offer among pre-sale projects, as such assets are able to bring higher profits in the long run.
Bitcoin ETF (BTCETF) is one such startup. It operates in the ERC-20 format and raised more than $1.8 million at the presale.
The increased demand among investors was also influenced by the project’s deflationary tokenomics. According to it, the developers are going to destroy up to 25% of coins, so that later there will be a shortage of supply.
However, the creators will not burn all these tokens at once. Instead, at each stage of bitcoin-ETF development, about 5% of assets will be allocated for destruction. The first burning should take place the moment the SEC approves the 1st spot ETF for bitcoin.
In addition, a fee will be charged on every transaction on the platform. This will help reduce the number of coins and encourage further growth. This unique approach to asset allocation also has an impact on the increasing interest in the project.
Early investors can buy BTCETF token on the presale. To do so, simply visit the project’s official website and purchase the coin for $0.0058.
However, users will have to hurry – the value of the asset will soon increase. In addition, after the release of BTCETF on exchanges and the launch of the burn mechanism, the price of the token may increase several times more. Features of the startup:
- Coin owners will have access to a news feed.
- All information about the process of opening a bitcoin-ETF can be found on one platform.
- The security of the project is ensured by the Ethereum network.
Conclusion
At the moment, the situation on the market of digital assets looks ambiguous. Regulatory attention continues to grow, and cryptocurrencies that previously showed high performance are getting cheaper. In addition, a major exchange like Binance is now also under pressure from the SEC. Because of this, according to CoinMarketCap, the 4th largest token, BNB, has also started to fall in value.
For this reason, investors are starting to turn their attention to smaller altcoins. In particular, those that are currently on presale (e.g. Bitcoin ETF). According to users, investing in this token involves fewer risks than investing in BNB.
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Author: Saifedean Ammous, an expert in cryptocurrency economics.
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