The BNB token faced harder challenges in the past weeks, with its price dropping big time, but some investors believe that the release of Changpeng CZ Zhao from jail could boost the price.
BNB market looks bleak, investors’ concerns are real?
Between August 23 and September 2, BNB experienced a decline of 16.1%, falling from a high of $598.80 to a low of $502.10.
There was a relatively strong buying activity below $510 that helped BNB recover some losses, and acted as temporary support, it’s currently trading below $500 at the time of writing.
Investors are worried that BNB may be entering a longer bearish trend, especially since it hasn’t been able to stay above $610 since mid-June.
The declining activity on BNB Chain also raising concerns, especially the DEX volumes, leading traders to speculate whether the price could drop to the $400 level again.
Time is ticking for CZ, but his release will help the BNB price?
Some market participants believe that BNB will only break out of its current pattern once its founder Changpeng CZ Zhao, is released from detention in the United States.
While there is no direct connection between CZ’s situation and BNB’s price, his strong presence and the excitement around his release could indeed influence the market.
Users in the social media shared a prediction that BNB’s price will surge if CZ is freed after his four month jail time.
Yet, even if this happens, it’s likely that traders will buy BNB ahead of CZ’s release and then take profits as the date approaches.
The classic ’buy the rumors, sell the news’ story. This means that buying BNB based solely on the anticipation of CZ’s release could be a risky move.
Binance’s market share is still strong, but BNB network fundamentals are weakening
BNB is still the third-largest cryptocurrency by market cap, valued around $75 billion. But the competition is hard, the Solana network now has more deposits in its smart contracts than BNB Chain.
To make matters worse, BNB Chain’s total value locked just hit its lowest point since February 2021.
Some warns that investors are finding better opportunities elsewhere, especially since total cryptocurrency TVL has increased by 27% year-to-date in 2024.
Deposits in BNB Chain’s smart contracts fell to 7.5 million BNB on August 20, marking a 14% decrease over three months.
PancakeSwap, the leading DEX on BNB Chain, saw its TVL drop by 15% to 2.93 million BNB, while PinkSale, a decentralized launchpad, experienced a 26% decline in TVL.
