The price of Binance Coin (BNB), the cryptocurrency of Binance and Binance Smart Chain, has increased by more than 20 percent in the past 24 hours.
The coin recovered rapidly after a market-wide correction on April 18. Many cryptocurrencies, including Bitcoin (BTC) and Ether (ETH), experienced sharp declines in the correction on Sunday.
ETH price, for example, declined from $ 2,400 to $ 1,900. BTC, on the other hand, lost its support of 60 thousand dollars and fell to 52 thousand dollars.
The futures market has been reset
The crypto market has experienced a sharp decline in the short term due to the overcrowding of the futures market.
Over $ 10 billion of crypto positions were liquidated in just one day. Bitcoin positions account for more than $ 5 billion of them.
Since there was a technical rather than a fundamental reason behind the decline, the market was able to quickly compensate for the loss.
The futures market behind the crash can be understood from the fact that the prices of major cryptocurrencies are lower than the spot market in the futures market.
BNB fundamentals remain strong
Cryptocurrencies with strong fundamentals recovered after the first decline from the futures market.
While Bitcoin gained 12 percent and Ether gained 15 percent, BNB’s performance in the last 24 hours surpassed both cryptocurrencies.
There are two reasons behind BNB’s strong performance: the record BNB worth $ 600 million burned by Binance and the rise of Binance Smart Chain metrics.
Binance burned $ 600 million worth of BNB in the first quarter of 2021. This transaction, in which the stock exchange reduced the supply in circulation, also states that it made at least 750 million dollars in profit in the first quarter.
Moreover, Binance CEO Changpeng Zhao stressed that the Binance team has no plans to sell their BNB savings, following the news that Coinbase employees sold $ 5 billion worth of COIN shares. The Binance team holds 40 percent of the total BNB supply.
#Binance team had an allocation of 40% of the total supply of #BNB from the ICO days, which is worth just over $37 billion dollars at today’s (dropped) prices. We have not sold a single #BNB so far, and never intend to. We will burn it all. More info: https://t.co/6YM7O7vqDZ
– CZ Binance (@cz_binance) April 18, 2021
Therefore, BNB may have had a delayed response to the burning of $ 600 million worth of tokens as the markets recover.
In addition to all these, the number of daily transactions performed on Binance Smart Chain has exceeded 5 million.