BNB’s Price Plunge: A Year in Review
The crypto bear market continues. Binance’s native token, BNB, has plunged to its lowest valuation in a year. As of August 21, 2023, BNB is priced at $207.47, a steep decline from its previous low of $227.85 recorded on December 17, 2022.
The decline in BNB’s value is tightly bound to the operation of the Binance exchange. Binance, besides utilizing BNB as its primary asset, is also at the helm of BNB Chain development.
SEC Lawsuit and BNB’s Decline
The most pronounced dip in BNB’s valuation began in early June, shortly after the U.S. Securities and Exchange Commission (SEC) launched a lawsuit against Binance. Central to the SEC’s accusations is the assertion that the token operates as an unregistered security, serving and controlled by the overarching global firm. This multinational entity is led by Changpeng Zhao, widely known as CZ, who proudly identifies as a holder of both BNB and BTC.
Binance’s Financial Stability Under Scrutiny
Over the last year, BNB has witnessed a significant depreciation of over 30%. Presently, BNB holds the 4th position in the cryptocurrency market cap rankings, boasting a total value of $32 billion. Recent metrics show the token suffering losses of 13% and 14% over the past week and month, respectively. This downward spiral has fueled growing concerns and speculation regarding Binance’s financial stability.
Such concerns arose when users took to X (Twitter) to voice their difficulties processing euro (EUR) deposits and withdrawals with the exchange. Binance’s official customer support handle, @BinanceHelpDesk, responded to these grievances, citing ongoing maintenance as the cause of the suspension of EUR bank transfers. However, the vague response did not provide an estimated timeline for the resumption of services, causing further consternation among users.
Binance has, however, offered alternative solutions for users during the hiatus, suggesting the use of card deposits and withdrawals. They also pointed users to alternative methods like credit card transactions and their peer-to-peer (P2P) platform.
What Does The Future Hold For BNB?
In an industry known for its volatility, Binance’s recent struggles highlight the vulnerability of even the most robust platforms. It remains to be seen how the exchange will navigate these choppy waters and what the future holds for BNB’s valuation.
