BNB Surpasses $700 ATH

BNB Surpasses $700: How High Could It Go?

Others have opined that the BNB rally was occasioned by leverage from buyers employing derivatives, specifically the FOMO traders. This theory received support when the open interest in BNB futures crossed $1 billion for the first time on June 6. Yet the futures open interest only gives the total number of aggregate contracts which are out in the market and does not reveal as to whether more leverage is required by the buyers (longs) or the sellers (shorts). Thus, 18% increase in six days cannot be explained by derivatives markets on the basis of this data.

Bnb price chart bnb surpasses $700

Thus, to evaluate traders’ interest, one should focus on perpetual futures which are also called inverse swaps. These contracts have an embedded rate that is adjusted every eight hours to address leverage demand asymmetry. A positive sign shows buyers’ preference for the use of leverage by sellers. In the last six days, the funding rate has remained below 0. Avg, which is not considered expensive for most traders, stands at 03%. This 0. BNB has a weekly funding rate of 2% which is similar to Bitcoin but lower than Solana at the current 0. 5%. Consequently, it is not logical to attribute the recent rally above $710 to excessive leverage in BNB futures usage.

Looking at the DApps activity, BNB Chain still holds a strong position in terms of volumes, whereas Solana is still behind in terms of the rankings. The past week saw BNB Chain record a 23% increase in volumes, and this comes at the expense of other competing blockchains. Nonetheless, BNB Chain’s reasonably stable active addresses interacting with the DApps leave questions about the efficiency of user acquisition. Moreover, the seven-day volume of BNB Chain is $6 billion, while Ethereum’s volume is $40 billion. 5 billion activity throughout the same time period.

Disclaimer: The information provided by CryptopianNews is for educational and informational purposes only. It should not be considered financial or investment advice. Cryptocurrency markets are highly volatile and speculative, and investing in them carries inherent risks. Readers are advised to conduct their own research and consult with a qualified financial advisor before making any investment decisions.

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