The cryptocurrency market has shown a quick recovery in early 2023, but many are skeptical that the ongoing rally will continue.
Some exchanges such as Coinbase and Crypto.com continue to cut jobs to weather the macro bear market, while others remain resilient. A good example – Binance.
BNB coin is the exchange’s native token. It is the base layer cryptocurrency and serves as the basic unit of currency for Build ‘N’ Build Chain (formerly: Binance Smart Chain) or BNB chain. It also functions as originally intended as a utility token for exchanges, offering users perks such as trading fee discounts and intense deflation his tokennomics nerd his cult.
The overview below is not accurate BNB coin price predictionBut instead, we provide an overview of some of the major potential headwinds and tailwinds facing BNB during 2023.
4 Key Tailwinds for BNB Price in 2023
Bull Run: BTC Price May Continue Rising
Bitcoin price is a fundamental force of gravity in the crypto exchange market economy. When the price of Bitcoin goes up, so does the price of altcoins.
Although the Ethereum network is increasingly challenging its dominance.
Nevertheless, even at this advanced stage of Ethereum’s deployment and development, its price is closely intertwined with the economics of Bitcoin.
As such, crypto investors can expect BNB to ride the tailwinds of Bitcoin, along with Ethereum and other altcoins. The question is which way will the Bitcoin price go?
While there are several reasons to be cautious, there are also many reasons to expect a Bitcoin bull market in 2023.
These include a newfound trust in the crypto sector after several villains were washed away. Trouble in 2022 is also that all sticking to decentralized layer 1 cryptos with active user bases over centralized apps with ERC-20s run by a bevy of careless and unscrupulous middlemen. I made a new old reason.
If stocks rise in 2023, Bitcoin could rise in line with macro stocks. But mostly, it’s a strong product with strong fundamentals and a bright future for the next decade and beyond.
Ultimately, as the macro risk-off mood shifts to risk appetite, investors can no longer afford to miss these attractive prices. And there are institutional investors and big hedge funds right around the corner. If Bitcoin steps in in 2023, BNB will almost certainly follow suit.
Clarity: US regulators may issue clear rules
The entire cryptocurrency industry is currently in a US regulatory dead end.
Due to the federalism (sharing of power) of the US government and the sophistication of today’s capital markets, no one is yet sure who is truly responsible for cryptocurrencies.
In fact, cryptocurrencies are such a novel invention that they do not fit well into existing categories that have been treated by US legislators, regulators, and courts.
Binance and its platform’s native tokens are in a worse regulatory trap than their US competitors. It could not be listed on other US exchanges because its owners fear it is a high-risk token.
They are concerned that despite its strong and active user base and huge market cap, BNB could suddenly become SEC regulated as a security like stocks and derivatives.
But even if this case were filed, could BNB be classified as a security?
In its lawsuit against FTX Exchange, the SEC asserted in the United States District Court for the Southern District of New York that: FTT tokens are securities.
Part of that allegation was that the FTX exchange had a “buy and burn” program similar to stock buybacks, and that Binance would burn out tokens from its quarterly profits, so the cryptocurrency exchange would not buy BNB. We are wary of the possibility of being judged as securities.
However, it is not always clear whether Binance’s token burn will work in the same way as FTX’s buy and burn program. Also, BNB is not just a liquid digital asset whose market price can be manipulated.
This is a script for interoperability between the developer’s app and the base layer blockchain, the BNB chain. It’s more a form of speech than a public company stock.
On top of that, it would be pretty difficult to end up with Ether classified as a security rather than a commodity born out of a global decentralized computer. Also, if Ether is a commodity and not a security, it would be very difficult for BNB to remain a security.
If congressional or regulatory consensus stipulates that BNB is a commodity alongside Bitcoin and Ether, it would immediately remove a huge source of investor uncertainty.
Reputation: Binance is Strong
Forbes Digital Assets column headlined an article about Binance and the BNB coin.
This is a huge amount of reserves that Binance has drawn internally to process all of its customers’ withdrawal orders. It may sound pretty bad, but when the average crypto investor considers Binance to remain solvent, it sounds pretty good.
they were good value for money. Exchange executives have repeatedly stated that Binance is ready to service and honor all customer withdrawal requests, even if it means withdrawing every penny from the platform. increase.
At one point this month, Binance processed over $7 billion in withdrawals in a single day.
There were no account withdrawals and new account freezes. There was no bankruptcy or SEC investigation. Binance customers withdrew cryptocurrencies or got their money back. they don’t forget it. This stands as a real-world stress test that has tumbled several other custodians, not Binance.
The reputation they have built up from there will continue to attract them. New crypto projects with the best talent and ideas were spot on, as well as investors and traders.
Fundamentals: Explore
BNB’s biggest tailwind is the sheer volume of cryptocurrency trades carried out by its platform and the fees it collects to facilitate those exchanges.
Binance handles billions worth of daily trading volume. We charge both buyers and sellers of cryptocurrencies a commission in varying percentages for these transactions.
Binance’s share of BTC trading volume increased in 2022, ending the year with 92% of trading volume, according to a recent report from Arcane Research. Arcane Research concluded:
“Binance is the crypto market no matter how you look at it in terms of trading activity. After increasing trading fees for BTC spot pairs this summer, Binance has completely overtaken all market share in the spot market.”
At its core, Binance is a profitable private company that continues to get the go-ahead in an increasing number of jurisdictions around the world.
Two Big Headwinds for BNB Coin Price in 2023
Bear Laut: BTC Could Get More Discounts in 2023
Bitcoin’s bargain price should attract more enthusiastic buyers. However, some disagree.
Bitcoin price is a complex variable made up of all kinds of macro, fundamental, industry and technical factors. There is no guarantee that we have hit bottom yet, and the crypto winter could last another year before the market makes a move.
Bitcoin price could plunge further in 2023. Low volatility and likely sluggishness. Without an upcoming rally, we can’t range anywhere. That will probably create headwinds for the BNB price.
Possible bearish scenarios for the Bitcoin price in 2023 include the possibility that the bankruptcy crisis in the crypto business continues to worsen, further shocks to investor confidence, and ambiguity in US regulation of cryptocurrencies.
If this happens, crypto investors can expect a headwind for BNB prices as well.
Regulatory hostility or ambiguity
US regulators have been tough on Binance, presumably for security and global strategic adversarial reasons. They could soon act to dominate BNB as a security.
BNB could not be listed on any US exchange except Binance US. That may be because they are concerned that regulators could move at any moment to control BNB as a security. If so, it will be subject to the jurisdiction of the SEC.
If this happens, the price may crash, but it is also certainly not the death knell for BNB.
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