2024-8-23 22:00 |
Binance Coin (BNB), the native token of the BNB Chain, has experienced a remarkable surge, extending its recovery streak for the third consecutive week.
As of August 22, 2024, BNB’s price reached approximately $574.93, marking a 3.2% increase over the last 24 hours and a notable 8.8% rise over the past seven days which adds to the 179.1% rise over the past 12 months.
This impressive performance is fueled by several key factors, including Binance’s strategic expansion of its compliance team, dovish signals from the Federal Reserve, and a market environment that continues to favor the cryptocurrency.
Binance to expand its compliance teamOne of the most significant drivers behind BNB’s recent price surge is Binance’s decision to expand its compliance team.
Binance, one of the world’s largest cryptocurrency exchanges, has faced increasing regulatory scrutiny over the past year, particularly concerning its Anti-Money Laundering (AML) practices and consumer protection measures.
To address these challenges, Binance announced plans to significantly bolster its compliance workforce in 2024.
According to CEO Richard Teng, at least 20% of the new hires will be dedicated to enhancing the company’s regulatory compliance efforts.
This move is seen as a strategic effort to improve Binance’s reputation and operational stability, which in turn could attract more users and institutional investors to its platform.
The announcement came shortly after Binance faced a class-action lawsuit from three crypto investors who alleged that they were unable to recover stolen assets due to the exchange’s failure to prevent money laundering.
By expanding its compliance team, Binance aims to mitigate such risks, which is likely contributing to the increased demand for BNB.
Favorable market conditions for Binance Coin (BNB)In addition to Binance’s internal developments, broader market factors are also playing a crucial role in BNB’s price increase.
The recent release of the Federal Reserve’s July meeting minutes indicated a potential shift in US monetary policy, with several Fed officials acknowledging the possibility of interest rate cuts in September.
This dovish stance has bolstered investor confidence in non-yielding assets like cryptocurrencies, including BNB.
As a result of these dovish signals, bond traders now see a 73.5% probability of a 25 basis point rate cut in September, compared to a 62% likelihood just a day earlier.
Lower interest rates generally reduce the opportunity cost of holding cryptocurrencies, making them more attractive to investors.
Moreover, BNB’s price has also been influenced by the dynamics of the futures market.
Since the cryptocurrency market experienced a rout on August 5, there has been a significant number of short liquidations in BNB futures.
Data from Coinglass indicates that short liquidations have outnumbered longs, with over $7.21 million in short positions liquidated compared to $3.86 million in long positions from August 5 to date.
On August 22, for instance, 376.31k short positions were liquidated compared to $140.62k long positions. This imbalance has added further upward pressure on BNB’s price.
BNB approaching a potential bearish reversalHowever, technical analysis suggests that BNB may be approaching a potential bearish reversal.
The price action is currently part of a rising wedge pattern, a formation typically associated with a potential downward break.
If BNB fails to maintain its current levels, it could target a decline to $480, the lower bound of the wedge pattern.
The post Binance Coin (BNB) price soars amidst compliance expansion and market optimism appeared first on Invezz
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