With bullish market momentum shifting gears from one altcoin to the next, Binance Coin appeared to be taking full advantage of the situation at press time. In fact, BNB was valued at more than $650, which was very close to its previous all-time high of $692 in May 2021.
There are, however, some significant differences between Q1 2021 and Q4 2021. And, while both periods exhibited bullish behavior, it is critical to understand the current developments.
Binance Coin, with a market cap of $111 billion, is gradually extending its lead over a surging Solana.
Binance Coin rises as BSC backs it – Is this sustainable?
Binance Smart Chain’s initial introduction as a competitive DeFi battleground against Ethereum allowed BNB to scale by more than 10x at the start of 2021. At the moment, its increasing functionality may be assisting BNB in re-testing its highs.
According to data, BSC has quickly established itself as a GameFi referral, and popular games like Mobox and CryptoBlades are driving traffic to the site. Ethereum’s Axie had captured the majority of the attention in the blockchain gaming world. However, Mobox and CryptoBlades are now bringing in over 200,000 Unique Active Wallets.
The graph above depicts the increasing activity on BSC during Q3 and the beginning of Q4 2021.
However, activity has not been restricted to gaming tokens. At the time of publication, the BSC-built PancakeSwap was the most widely used decentralized application in the industry. PancakeSwap, as a marketplace, attracted over 37,000 unique traders and generated over $39 million in trading volume in October alone.
These are substantial increases of 140.72 percent and 676.67 percent, respectively. Furthermore, PancakeSwap is currently responsible for the highest trading volumes among all involved DEXs, accounting for more than 25% of the market share.
A scuff in the armor?
While BSC had extremely impressive statistics for its supported protocols, Solana is currently outperforming it. Solana is gaining ground at breakneck speed.
And, despite having half the market cap of Binance Coin, its total locked value was $25 billion at press time, compared to Binance’s $21 billion.
Keeping these points in mind, from a structural standpoint, BNB is only a few centimeters away from testing its $692 resistance. The only difference is that there is currently no development hype.
It is reasonable to believe that if BNB closes its weekly candle above $692, momentum will push its case forward. Unfortunately, in comparison to its early-year exploits, its own trading volumes are much thinner at the moment.
Binance Coin has the potential to go on a tear after breaching $692, but fundamentally, it may not be as strong as Q1 2021. Before jumping on the BNB bandwagon, investors should keep this in mind.