Binance has suffered a lot of FUD in recent days, with serious accusations being made against the leading exchange on the cryptocurrency market, which has negatively impacted the capitalization of BNB, the crypto platform’s token.
BNB has lost about 11% of its market capitalization in the past seven days. While this drop is not unique to the altcoin, as other cryptos in the top10 have also experienced similar and even worse drops, the fear behind it goes far beyond the bear market.
What's happening with Binance?
The company that created BNB and its CEO, Changpeng Zhao (CZ), may be sued in the United States as part of a probe into the company's adherence to the country's money laundering laws.
U.S. authorities are investigating whether the crypto trading platform failed to follow anti-money-laundering laws and sanctions imposed against countries, individuals and companies.
This was enough to bring major panic to people who have entrusted their investments to Binance. For example, last week, about $1.14 billion in net withdrawals took place at the cryptocurrency exchange.
However, it is worth noting that CZ has spoken out on the matter, saying that this is not a big problem, as this is a natural market movement. Moreover, its exchange had already experienced withdrawals larger than that.
But this was not the only event that brought negativity to the crypto exchange last week. Some Binance users reported the abnormal trading of some altcoins on the platform.
The rumor was that the abnormal trades might have originated from hackers. The attackers would have stolen the API keys of some users through 3Commas. As a result, they would be using these accounts to execute the trades.
This news was denied by CZ. The businessman stated that his company has locked some very profitable accounts.
How have these events affected BNB?
Despite BNB's price drop, as mentioned above, the altcoin was not the biggest loser in the top 10. Dogecoin (DOGE), for example, lost 19% of its market capitalization.
As such, the recent movements look more like FUD than something that should really concern the Binance crypto investor. With a market upturn, BNB will remain down, as it has a reason for a capitalization increase.
BNB Chain, the Binance network, continues to grow despite all of the accusations leveled against the crypto exchange. It has maintained its lead in new addresses over the past 12 weeks, gaining 17.4 million new addresses.
Another factor involving BNB Chain that may help Binance's crypto revival is the number of daily active users on the blockchain. The cryptocurrency trading platform's network has reached the top spot in this arena ahead of even Ethereum (ETH) and Polygon (MATIC).
Binance has shown resilience, with large withdrawals occurring within a few days, something that could detonate a smaller crypto exchange. This is also being taken into consideration by investors who keep their confidence in BNB.
Alex Dovbnya
Arman Shirinyan