Binance’s native token, BNB, has reversed its downward trend, alleviating concerns among digital-asset investors. Over the past two days, BNB has experienced a 10% bounce to reach $247, while a Bloomberg index of the top 100 coins has remained relatively unchanged.
The token had suffered a 10.8% drop in the last seven days, hitting its lowest level since 2022, according to data from CoinMarketCap.
SEC lawsuit erased most of BNB’s gain
The slide was triggered by the US Securities and Exchange Commission’s lawsuit against Binance Holdings Ltd. and its founder, Changpeng Zhao, for violating regulations. The SEC also identified BNB as one of several unregistered securities in the digital-asset sector. With a market value of $38 billion, BNB is currently the fourth-largest cryptocurrency, offering users trading fee discounts and being closely tied to Binance’s success.
While Binance’s responses to the SEC lawsuit have helped stabilize BNB, Markus Thielen, head of research at Matrixport, warns of potential risks ahead, as the US Department of Justice may bring further charges. Thielen highlights the significance of the $200 level as a key threshold for BNB.
Speculation had circulated on Twitter suggesting that Binance sold its Bitcoin and stablecoin holdings to generate funds for supporting BNB’s price. However, a Binance spokesperson refuted these claims, stating that the company did not make any such sales for that purpose.
Binance and Zhao are facing accusations from the SEC, which involve alleged mishandling of customer funds, misleading investors and regulators, and violations of securities rules. In response, Binance has expressed disappointment and committed to vigorously defending its platform.
The latest incidents, including the collapse of FTX, have raised concerns about the resilience of trading platforms within the sector. The SEC has also been ramping up its scrutiny of the cryptocurrency realm. While nations around the globe embrace crypto, US regulators are trying to push the sector away.
Source: https://coinpedia.org/altcoin/binances-bnb-token-recovers-from-slump-easing-crypto-investors-concerns/