Decoding the wealth of BNB

According to DeFiLlama data, the transaction volume of BSC chain DEX surpassed that of Ethereum chain DEX on March 10, taking the top spot in one fell swoop.

Meanwhile, BNB’s price has increased by nearly 30% in the past week, and its trading volume has also increased significantly. So far in 2024, its performance has been better than similar tokens, with the largest increase among exchange tokens and the largest increase among public chain native tokens.

As the native token of Binance Exchange and the fuel token of BNB Chain, such eye-catching popularity naturally triggered the market's bullish sentiment towards BNB, the golden shovel.

Why is BNB the golden shovel of this bull market? What wealth code does this round of rise contain? The next article will take you to explore the huge potential and opportunities of BNB tokens.

0 1 BNB recent increase

Recently, the price of BNB soared again, briefly breaking through 630 USDT, setting a new high since December 2, 2021.

How strong has BNB’s rally been? It has risen 50% since the beginning of March and more than 80% in the past 30 days.

Looking back at the last bull market, BNB once hit an all-time high of 690.93 USDT, and then experienced price fluctuations from 2022 to 2023, maintaining a level of around 200-400 USDT. It is currently only 9% away from its all-time high.

This upward momentum means that the market's concerns about Binance's regulatory incident have decreased. BNB has still shown strong resilience after the storm and has rebuilt confidence to a certain extent.

In addition, Binance Launchpool (new coin mining) also provided key impetus for the rise of BNB.

0 2Binance Launchpool

Binance Launchpool is a service provided by Binance Exchange, where users can receive token rewards from new projects by staking cryptocurrencies. This section is also known as new coin mining.

This process is a bit like staking mining, except that the mined coins cannot be traded immediately, and may contain high-quality projects with potential. In other words, exchanges allow users to participate at a lower cost and risk and obtain new coins that are about to be listed.

There are many explanations for the rapid rise in BNB price, and Binance Launchpool is an indispensable part of it. The mining rules are simple. Users participate in mining by staking BNB and FDUSD to obtain new coin rewards. This makes Binance Launchpool's empowerment of BNB directly hit the core of the price increase.

For example, the on-chain derivatives exchange AEVO, which was newly launched on Launchpool on March 6, brought a significant boost to the price of BNB.

In less than a week, BNB rose from 400 USDT to 500 USDT, attracting the attention and participation of a large number of investors.

Looking back, Binance has launched 7 Launchpool projects at a high frequency since the first quarter, with the number of participants ranging from hundreds of thousands to several hundred thousand. With such a large influx of demand, the price of BNB has naturally risen all the way.

Launchpool Yield: BNB Returns Higher

Currently, the staking currencies used to mine new tokens in Launchpool are BNB and mainstream stablecoins. Biteye uses the staking data officially released by Binance as a basis to calculate the annualized rate of return of the complete mining cycle of the projects launched this quarter.

1) Participating in Launchpool is a relatively safe and profitable way of mining.

2) The yield of BNB mining is much higher than that of the other two stablecoins, almost equal to the sum of the two. Binance Launchpool can be said to be a "robust financial lottery" tailored for BNB holders.

Why do you say that? Let’s take a look at the historical performance returns of Launchpool below?

1) Launchpool new coin mining yield from Q1 2024 to date

2) Comparison of mining yields using different tokens

Note: The current price reference time is 19:00 on March 13 (UTC+8)

1. Judging from the mining APY of the past seven Launchpools, the average yield brought by the price performance on the day of listing exceeded 100%, and the highest yield of MANTA reached 186.92%.

If the game is based on the highest price in history, APY will double. And because the mining time is generally short, it greatly reduces the time that users' funds are occupied. Therefore, participating in Launchpool can be said to be a safer and more profitable way of mining.

2. From the above overall increase ratio, it can be seen that the increase ratio of the new coins launched on Binance Launchpool recently is almost around 200%, and the highest price of XAI is close to 3 times the closing price of the listing trading day.

It can be seen from the listed currencies that there are many high-quality projects, which is also one of the important reasons for the subsequent rise in currency prices.

Most of the high-quality projects are issued through Launchpool, such as the highly-watched derivatives trading platform AEVO, the dark horse Pixel in the blockchain game track, and the newcomer Xai in the L3 game track. Almost all of them are projects with very good fundamentals and a strong user base, and they also have certain potential for development in the future.

It can be said that the new coin projects launched on Binance have good returns.

3. By comparing the three mining methods and calculating the yield brought by the online price performance, the BNB mining yield is much higher than the other two stablecoins, almost equivalent to the sum of the two.

Imagine that when you hold 100 BNB in ​​a bull market, and put them into the mining pool with basically lying down operations, you will pocket 1000u in 5-7 days, which is definitely a golden shovel in the bull market.

0 3Platform Development

BNB has the dual concepts of "platform coin + public chain coin". Its value mainly depends on the fundamentals of the exchange behind it, as the saying goes, "it's good to lean on a big tree for shade."

This also conforms to a basic rule: the development of a platform directly affects the market performance of its tokens.

Market share

Judging from the market share performance, despite the impact of turmoil such as the FTX incident in recent years, Binance's market share remains stable at around 50%, maintaining its position as the "number one exchange" unaffected.

As can be seen from the figure below, Binance's market share has been steadily increasing since Q1. In 2023, Binance attracted more than 40 million new users and has accumulated 170 million registered users, an increase of nearly 30% from the end of the previous year.

Business Level

So from a business perspective, what kind of empowerment can Binance, which is backed by BNB, bring to it?

The answer is that the ceiling is high enough and the imagination is big enough. As the world's largest cryptocurrency exchange, Binance has not limited itself to its own trading business in recent years, but has worked hard to build a comprehensive cryptocurrency ecosystem.

First of all, Binance’s investment at the exchange level can be described as “holding user needs in the palm of its hand”, including upgrading Binance Square to retain more creators and active users. In the past year, the number of creators in Binance Square has increased from 1,200 to 11,000, and the number of daily active users has increased from less than 700,000 to more than 1.6 million.

Launchpool projects are launched frequently, allowing users to earn returns that exceed most financial management through new listings. Binance uses its brand effect to give concessions to users, achieving mutual benefit and win-win results while improving user loyalty.

The copy trading function was launched in October last year. The average weekly trading volume in three months exceeded US$2 billion, and it has gradually taken on the shape of a social trading platform.

Recently, Binance launched Futures NEXT, which allows users to earn rewards by predicting the listing of tokens on Binance Futures. The NEXT Pool displays a curated collection of potential listing tokens nominated by users.

The most noteworthy thing is that the Web3 wallet was launched in the Binance app in November last year, making it easier for users to switch between CeFi and DeFi. There is no need for tedious registration, just one click is enough.

On the one hand, this update effectively lowers the threshold for new users to enter the Web3 ecosystem, and on the other hand, it also enables old users to perform on-chain operations more conveniently.

In addition, in response to the hot user demand, the Inscription Market was officially launched on the Binance Web3 wallet on February 1.

The latest update was on March 15th, when Web3 Wallet completed Solana network integration, helping users easily manage and trade Solana network tokens and access a variety of dApps.

There is no doubt that the exchange has always been at the core of Binance's territory, and Binance Labs, as an investment and incubation project line, also plays a vital role.

Binance Labs uses its industry-leading resources and financial advantages to support excellent projects to accelerate their development and reduce their burden of listing and liquidity construction. This strategy not only attracts high-quality projects and teams, but also brings more users to Binance, achieving mutual benefit and promoting the prosperity of the entire ecosystem.

In the past year, Binance Labs has mainly focused on Web3 blockchain games, defi ecology and ZKP (zero-knowledge proof) fields, contributing numerous application scenarios and business models, and bringing more diverse product options to users.

In addition to the above-mentioned sectors, as we all know, Binance's ecosystem has also expanded to the public chain, forming a CeFi+DeFi closed loop.

BNB Chain has developed into a comprehensive DeFi system consisting of multiple chains, integrating computing, storage and Layer 2 technologies.

This is not just a single chain, but a comprehensive "family bucket" multi-chain development, which has become an existence that cannot be ignored in the DeFi field.

Based on the prosperous BNB Smart Chain and the decentralized storage platform of BNB Greenfield, the BNB Chain ecosystem has gained significant benefits.

At the same time, the introduction of low-cost transactions based on Optimism technology, opBNB, filled the gap in Layer 2 and further significantly reduced the gas fee of the already low-cost BNB Smart Chain.

BNB Chain's 2023 annual report pointed out that the number of daily active users exceeded 1 million in the past year, which was a significant increase. On March 10, the DEX transaction volume on the BSC chain reached US$2.474 billion, ranking first.

The daily transaction volume of DEX on the Ethereum chain was US$2.038 billion, and its ranking dropped to second place; the daily transaction volume of DEX on the Solana chain was US$1.361 billion, ranking third.

In the last quarter, BNB Chain has made updates in multiple directions:

Cheaper. The official plan is to double the opBNB transaction speed and reduce the gas fee by 10 times.

More comprehensive. The introduction of the One BNB concept aims to integrate BSC, opBNB, and Greenfield into a cohesive ecosystem, ensuring seamless interaction between decentralized computing and storage solutions.

More airdrops. On March 13, BNB Chain launched the "Airdrop Alliance Program", which will release retroactive airdrops to BSC and opBNB users to reward the community for their support of BNB Chain. This shows that BNB Chain is vigorously developing the on-chain ecosystem. Since BNB is currently automatically destroyed quarterly and anchored to the total number of BNB Chain blocks, the more active the on-chain ecosystem is, the more worth looking forward to the rise in the coin price.

It can be foreseen that a thriving multi-chain system will further become an important force in the DeFi public chain.

0 4 Summary

In the Web3 field, Binance's business scope has expanded over the years and has covered many aspects: from core exchange functions to cloud services, PoW mining pools, staking services, to financial and payment solutions, as well as investment and incubation activities around Binance Labs.

At the same time, with the strong strength of BNB Chain in the DeFi field, Binance has achieved coverage of almost every important field.

Having said that, BNB, as the only carrier for value capture in the Binance ecosystem, has the imagination of the public chain coin ecosystem in addition to the platform currency. At the same time, it reaps the development dividends of Binance and BNB Chain, and its long-term value is very considerable.