January 30, 2023

  • Binance clears the air of doubts about its all-encompassing well-being.
  • Futures and options traders hang back on trading BNB.
  • On-chain data shows losses for investors amid deposit recovery.

After weeks of allegations and counter-accusations, Binance has finally addressed the issues raised as it aims to end the uncertainty and doubt that have rocked the stock market.

In his seven part blog postpointed out to Binance that it needed to officially respond to the false information spreading across the crypto community as it championed transparency and openness.

How much BNBs can you get for $1?

Recall that Binance has faced challenges across the board since the collapse of its competitor, FTX. At one point, the United States Department of Justice (DOJ) moved toward full prosecution of the exchange. More recently, the Mazars accounting firm withdrew from its investigation into the stock market’s financial health.

Hale and in good condition, says exchange

In addressing the concerns of investors and the ecosystem at large, Binance clarified that it had no liquidity issues despite the suspension of USDC withdrawals. Regarding its reserves, the exchange noted that it was very sound financially.

Given the Mazars issue, Binance explained that auditing encrypted companies like theirs was a new concept. So the talks about the big four accounting firms rejecting the audit process had no valid reason.

As for the DOJ prosecution, the blog post indicated hesitation over full clarification. However, it noted that it had duly followed regulatory policies in several countries and that it would be addressed at a later date. The publication read,

“We are currently unable to comment on controversial judicial discussions, but in light of one-sided media allegations, we also hope to clarify and highlight the following facts that have long been ignored by the public.”

BNB volume rises but falters…

Despite the explanation, Binance coin [BNB], relapsed on picking up a significant increase. However, the 24-hour trading volume was able to replace the price stagnation with an increase of 18.36%. According to on-chain data provider Santiment, BNB volume was $546.13 million at the time of writing.

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This condition reflected an attempt by traders to jump on BNB based on price movements. The traders’ trading in the derivatives market was inconsistent with the overall market’s performance.

This was because Santiment data revealed a massive drop in the exchange funding rate of -0.007%, indicating retracement in positions in futures and options contracts.

BNB Derivatives Trading Volume and Funding Rate

Source: Sentiment

With regard to the active addresses, on-chain data showed that BNB was proficient at attracting and improving user activity. This was due to the increase in seven-day active addresses on Dec. 21, though the stat was down to 23,600 at the time of writing.

Consequently, Binance was in the process of recovery confidence after billions of dollars in outflows from the stock market.

According to the 30-day market value to realized value (MVRV) ratio, BNB remained resolute in keeping investors in losses. With -13.27%, the MVRV outlined an undervalued scenario. However, it also meant negative results for holders who bought at a price higher than the current value.

BNB active addresses and MVRV ratio

Source: Sentiment

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