- BNB has declined by 3.5% over the past week.
- Binance’s spot volume outpaces all other exchanges combined.
While the crypto market has experienced a sustained period of uncertainty, Binance’s market dominance has continued to rise.
According to analyst Joao Wedson, Binance’s spot volume has surpassed all other exchanges combined.
It’s currently 8x larger than Coinbase, demonstrating its superiority in market share. Even though spot volume has declined across exchanges over the past two months, Binance’s dominance continues to rise.
Source: CryptoQuant
At the start of 2024, Binance’s trading volume exceeded that of all other exchanges combined, highlighting its significant influence on liquidity and market dynamics.
For example, in January 2024, as Binance’s volume surged past its competitors, Bitcoin’s price skyrocketed from $42,000 to $73,000 within weeks. Similarly, Binance’s native coin, BNB, experienced remarkable growth, rising from $335 to $645 during the same period.
Source: CryptoQuant
Historically, Binance’s strong performance in spot trading volume has often signaled a bullish market trend in the weeks that followed.
The Binance vs. Other Exchanges BTC Spot Volume Delta indicator is once again positive, suggesting a potential bullish outlook in the coming months, despite a decline in overall aggregated spot trading volume.
Any impact on BNB?
Despite the rising dominance, the market is yet to turn bullish for Binance Coin [BNB]. In fact, BNB investors, both large entities and retail, remain bearish.
The recent sale of 10,850 BNB tokens, valued at $6.51 million, by Gnomelabs provides the first indication of this sentiment. Onchain data reveals that Gnomelabs has deposited a total of 76.37 million USDC into Binance and Bybit.
Source: Coinalyze
When such a large holder turns to selling, it shows a lack of market confidence, reflecting bearish sentiments.
Looking further, a negative futures basis validates strong bearishness. When the futures basis turns negative, it implies that the future price is lower than the spot price.
Such a market setup suggests that traders expect lower prices in the future, reflecting strong bearish sentiment.
Source: Coinalyze
With futures entering negative territory, BNB’s Aggregated Funding Rate has also turned negative, indicating bearish sentiment in the futures market.
Over the past week, the Funding Rate has consistently remained in negative territory, suggesting an increasing number of traders are taking short positions. As a result, shorts are paying longs, reflecting expectations of further price declines.
Although Binance’s dominance continues to rise, BNB has not mirrored these gains in the short term. Consequently, Binance Coin remains bearish, and current market conditions point to a potential further correction before any upward movement.
If this sentiment persists, BNB is likely to drop below $600, potentially reaching $576.
However, if the past is any indicator, a repeat of the previous cycle—where Binance’s dominance surged—could drive a recovery towards $618, strengthening the altcoin for a possible rally to $638.
