Binance Coin Shows Resilience Amid Crypto Crash

Binance Coin (BNB) has largely avoided the ongoing crypto crash and is hovering near its all-time high. As of Friday, BNB was trading at $695, just 12% below its record high reached in December. This is a stark contrast to other major cryptocurrencies, with Bitcoin (BTC) falling by 15%, and mega cap cryptocurrencies like Solana (SOL) declining by over 20%.

BNB’s Lower Correlation with Bitcoin and Quarterly Token Burns

BNB’s resilience can be attributed to its lower correlation with Bitcoin and other cryptocurrencies. Data shows that BNB’s 90-day correlation coefficient with Bitcoin stands at 0.65, lower than that of many other major coins. Additionally, BNB’s substantial quarterly token burns have reduced the supply of coins in circulation, positively influencing its price action.

Binance employs two types of burning mechanisms: real-time and quarterly burns. Real-time burns have incinerated BNB tokens worth $171 million, while the quarterly burn in the fourth quarter saw 1.63 million BNB tokens worth $1.02 billion being burned. The upcoming quarterly autoburn is expected to incinerate an additional 1.55 million tokens, valued at around $1.09 billion.

BSC Ecosystem Continues to Thrive

The BSC ecosystem has also continued to perform well in the past few months. The ecosystem’s total value locked (TVL) has grown by 3% in the last 30 days, while Ethereum, Solana, and Tron have shed over 8% in this period. Decentralized Exchange protocols within the BSC ecosystem have processed more than $9.75 billion worth of tokens in the last seven days.

Technical Indicators Suggest Upside Potential

Technical indicators suggest that BNB has further upside potential in the long term. The token remains above both its short-term and long-term moving averages. Additionally, the Relative Strength Index and the MACD — two popular momentum oscillators — have continued to rise, signaling bullish momentum.

BNB has also formed a cup and handle chart pattern, a bullish continuation signal commonly seen in technical analysis. If the pattern completes, BNB could see a price increase of more than 70%, potentially surging to over $1,180 in the long term.

Key factors contributing to BNB’s resilience:

  • Lower correlation with Bitcoin and other cryptocurrencies
  • Substantial quarterly token burns reducing supply
  • BSC ecosystem’s continued growth
  • Bullish technical indicators

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