3 reasons why Binance Coin (BNB) hit a new all-time high at $148
Record high trading volume and new offerings from Binance are a few of the factors behind Binance Coin hitting a new all-time high at $148.
On Feb. 10 Binance Coin (BNB) hit a new all-time high at $148 after the native exchange token rallied 121% since the start of the week.
Three reasons for the explosive growth in the price of BNB include the recent surge in trading volume to a new record high, the expansion of DeFi related protocols to the Binance Smart Chain, and a steadily expanding ecosystem which is supported by new partnerships and integrations.
Between September 2020 and December 2020 the price of BNB traded between $23 to $35 with an average daily volume of $400 million. Since Dec. 28 there has been a steady increase in 24-hour trading volume and token price as Bitcoin (BTC) price broke out to new highs and DeFi made its presence felt across the crypto sector.
BNB’s 24-hour trading volume surpassed $1 billion for the first time on Feb. 1 and a new record $7.52 billion volume record was set on Feb.10 as the price crossed above $148.
DeFi integration gives Binance an edge
Since 2020 centralized exchanges had been ceding market share to decentralized finance protocols which offered users access to newly launched tokens and high APY returns for providing liquidity.
To make up for this loss of market share, Binance incorporated new DeFi components, including the creation of Binance DEX which supports a few interoperability-focused DeFi projects.
Binance also increased the number of tokens available on its staking platform and the exchange raised the interest rates for each token to encourage investors to stay on the exchange instead of chasing yields at SushiSwap and Uniswap.
BNB plays a role in fee settlement and transfers, thus boosting its volume and value over the past few months.
New listings and partnerships
Binance has not been shy about quickly listing new projects from the DeFi sector and these listings often spark a sharp increase in the trading volume and price of the newly listed token.
For example, when Uniswap and SushiSwap burst onto the scene and threatened to take some of Binance’s trading volume, the exchange countered by listing both UNI, SUSHI and many of the projects that were attracting investors’ attention.
Several prominent DeFi projects were initially launched on Binance Launchpad, the in-house token launch platform that helps blockchain projects raise funds, and more projects being added on a regular basis.
Projects like Kava, which operates on the Cosmos (ATOM) blockchain, and Venus (XVS), which operates on the Binance chain, were incubated on Binance Launchpad and have since become established DeFi projects that continue to gain momentum.
A scroll through Binance’s Twitter feed shows daily announcements of new partnerships and integrations and for investors to interact with many of these projects they are oftentimes using BNB as part of the transaction.
With a 24-hour trading volume of $32.8 billion, a figure 7 times larger than its closest competitor Coinbase Pro, Binance continues to dominate among centralized and decentralized exchanges.
Binance Coin appears well positioned for further growth, especially considering that BNB is an integral part of many of the platforms and processes at Binance.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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