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BNB Chain network booms – So why does the altcoin continue to struggle?

2min Read

Weak market sentiment overwhelms BNB despite impressive network growth.

BNB Chain network booms - So why does the altcoin continue to struggle?
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  • BNB Chain has seen incredible network traction, hitting 463.7M unique addresses. 
  • Overall, weak sentiment could drag BNB to $500 or below. 

The Binance [BNB] chain has maintained the lead on key network growth, ranking first on total unique addresses in August. According to recent data, the chain’s unique addresses hit 463.7 million. 

The chain also ranked fourth in total transactions, with 209 million transactions in July. 

BNB

Source: Coin98

This indicated increased network traction, which isn’t surprising given the chain’s active Binance Launchpool and Launchpad projects. Interestingly, an uptick in the Binance network also coincided with its record price of $721 in June.  

So, how has the recent network traction impacted BNB price performance? 

BNB price analysis

BNB

Source: BNB/USDT, TradingView

In the past week, BNB shed over 12%, dropping from $598 to near the psychological level of $500.

BNB’s downward pressure was part of a market-wide bloodbath induced by fears of the U.S. recession and tensions in the Middle East. 

As such, recent network traction couldn’t ease the recent BNB price dump. If the bloodbath persists, BNB could breach the daily order block, marked cyan, above $505.

Should the support break, BNB could be dragged towards the July lows of $454. 

Interestingly, the RSI (Relative Strength Index) had eased near oversold territory, meaning selling pressure could peak and reverse. 

Similarly, the CMF (Chaikin Money Flow) declined but had not fallen below its average level, suggesting that outflows from BNB markets increased. 

However, if it doesn’t break below the average level, especially if market sentiment improves, it could signal a likely price reversal. 

Futures market status

Like the massive dump on spot markets, as shown by the price charts, futures markets were also bearish on BNB. As of press time, 53.8% of leveraged traders were shorting the altcoin, against 46% of speculators who went long. 

BNB

Source: Coinglass

Meanwhile, reports allege that tensions in the Middle East could escalate on the 5th of August. If so, the crypto market would react to the developments. 

That said, the market sentiment was in extreme fear, which some, in normal circumstances, see as an opportunity to buy into the bloodbath.

However, gauging developments in the Middle East and the U.S. could be crucial before making moves. 

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Benjamin Njiri is a Crypto Analyst and Journalist at AMBCrypto who specializes in technical analysis and identifying emergent market trends. He excels at breaking down complex chart patterns and on-chain data to make them accessible and actionable for investors. His rigorous analytical approach is founded on his academic background as a Telecommunication Engineering graduate. This discipline has equipped him with an expert understanding of signal processing and data analysis, allowing him to systematically filter market noise from true trend signals with engineering precision. Armed with this unique perspective, Benjamin focuses on providing clear, data-driven insights into the digital asset landscape. His work is dedicated to demystifying the intricate world of cryptocurrencies, empowering readers to understand the forces that shape the market and to navigate it with greater confidence.
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