BNB Price Could Rebound as Holders Remain Firm

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BNB chain native token, BNB, has experienced a 7% drop since the CFTC lawsuit announcement. On-chain data reveals optimism among long-term holders. Can Binance’s native coin rebound in the coming weeks? 

BNB is the native coin of the BNB chain created by the world’s largest cryptocurrency exchange, Binance. It has recently hit a price correction amid regulatory scrutiny. Days after briefly pausing spot trading due to technical issues, the U.S. Commodity Futures Trading Commission (CFTC) charged Binance on March 27. The lawsuit alleges that Binance violated compliance controls. 

Markets reacted negatively as price of BNB rapidly declined. But on-chain data suggests an impending rebound. 

Long-Term Investors Hold Firm 

According to the blockchain data analytics platform, Santiment, BNB long-term holders appear unfazed by the recent fear, uncertainty, and doubt (FUD) surrounding the Binance ecosystem. Since the recent local low on March 9, Mean Coin Age has increased considerably. 

Between March 9 and April 4, Mean Coin Age increased by nearly 52% from an average of 44.30 days to 67.30 days. 

BNB Mean Coin Age. April 2023. Source: Santiment

Mean coin age refers to the average age of all the coins in circulation. It is calculated by taking the total number of coins in circulation and dividing it by the total days spent in their current addresses.

As observed above, the average age of coins on the BNB network has increased by nearly 51%. This implies that many investors are holding onto their coins around the current prices. 

Such investor behavior, if sustained for an extended period, can drive up the price of the underlying cryptocurrency as supply may increasingly wane compared to demand. 

Similarly, on-chain data shows that the native coin has not lost much traction despite the recent price downswing. This further validates the bullish outlook. 

In recent weeks, the BNB chain has experienced a positive divergence between price and daily active addresses, according to Santiment. The chart below shows that while the price declined 7% between March 26 and April 3, daily traction on the network has rebounded from 3,277 addresses to 3,947. 

BNB Price vs. Daily Active Addresses. April 2023. Source: Santiment
BNB Price vs. Daily Active Addresses. April 2023. Source: Santiment

The 20% uptrend in daily active users during a 7% price downswing implies the BNB chain has sustained its fundamental network value. And if this continues, it is only a matter of time before the price rebounds. 

BNB Price Prediction: Impending Rebound to $340

The Market Value to Realized Value (MVRV 30d) data depicts that BNB investors that bought within the last 30 days are sitting on 12% gains. And looking at the historical buy/sell patterns, they could hold out for an additional 10% price surge to $342 before they start selling.

If that sell zone does not break the rally, then it may approach $363. At this point, investors could sell massively to book some of their 29% gains. 

BNB Market Value to Realized Value. March 2023.
BNB Market Value to Realized Value. March 2023, Source: Santiment

Still, the bears can gain ground if BNB slips below $282. At this point, investors could stop selling to avoid their profits dwindling past 2%. But if the retracement persists, the 4% at $266 could be the next significant support.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions.



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