The world’s third-largest cryptocurrency, BNB, has made significant strides over the past year, outpacing both Bitcoin and Ethereum in terms of returns. Up an impressive 129% within the last year, BNB’s momentum has particularly accelerated in recent weeks, with a notable 29% increase since the start of October. This surge has led to a remarkable increase in its market cap, swelling by more than $41.7 billion according to data from CoinMarketCap.
Several factors are contributing to this rally. First, the growing adoption of Binance, the largest crypto exchange by trading volume, has played a crucial role. With claims of having 290 million users and facilitating $14.8 billion in inflows last quarter, Binance is experiencing a wave of trading activity as interest in cryptocurrencies surges. Furthermore, BNB Chain has also seen a spike in user engagement, generating $5.5 million in network fees within 24 hours leading up to October 8.
Another factor in BNB’s rise is the launch of Aster, a multi-chain decentralized exchange introduced by Changpeng Zhao, the former CEO of Binance. Launched in late September, Aster aims to compete with leading decentralized platforms like Hyperliquid. Its temporary surge in trading volume brought increased attention to BNB, though concerns about data integrity have led to its removal from some tracking services.
Additionally, corporate treasuries are increasingly acquiring BNB. For instance, CEA Industries, a vape producer, recently disclosed holding $611 million in BNB and indicated plans to bolster its crypto treasury. Similarly, B Strategy, an investment firm in digital assets, has announced collaborations to establish a $1 billion Binance Coin treasury.
However, not all reactions to BNB’s price increase have been positive. Some crypto enthusiasts have expressed skepticism online, questioning whether the token’s rally is driven by market manipulation. Despite these doubts, analysts like Zack Shapiro from The Bitcoin Policy Institute suggest that the current market cycle, characterized by speculatory behavior and a general influx of capital into risk assets, is a more plausible explanation for BNB’s rise.
The wider cryptocurrency market has resonated with buoyancy this year, witnessing a total increase in value nearly reaching $1 trillion and breaking multiple records. Bitcoin, the most prominent cryptocurrency, was trading around $124,000 recently, showing a slight decline from its recent all-time high of over $125,000. As the market continues to evolve, the spotlight on BNB demonstrates how dynamics within the cryptocurrency landscape are constantly changing, and it remains to be seen how sustainable this recent growth will be.
