QCP Capital analysts explained the steady growth of BNB, the native token of the Binance cryptocurrency exchange.
QCP Capital experts believe Binance has created an effective self-sustaining growth cycle for BNB with the help of Launchpool, a platform for launching an initial token offering among projects selected by the exchange. Thus, users of this product often reinvest farmed assets.
“BNB, in particular, has managed to create a virtuous self-reinforcing cycle through its Launchpool as BNB stakes sell their hefty airdrops and buy even more BNB.”
QCP Capital
Experts explained that platform clients sell tokens received as part of the campaigns and increase their position in BNB for subsequent staking. Given the frequency with which the latter appears, reinvestment occurs almost weekly, QCP Capital adds.
According to CoinMarketCap, BNB has risen by more than 30% in the last seven days to $595 at the time of writing. At the same time, the asset previously reached the level of $630, which is a multi-year high. BNB is now 14% short of its all-time high (ATH) from May 2021.
BNB has been growing despite Binance’s recent problems. Earlier, the U.S. District Court changed the bail conditions for the cryptocurrency exchange’s founder, Changpeng Zhao, and ordered him to surrender his Canadian passport.
The exchange also faced problems due to Nigerian requirements. The country’s authorities demanded that the crypto exchange provide information about the 100 most significant users in the country and their transaction history over the past six months.
The period under review is critical because it coincides with the devaluation schedule of Nigeria’s national currency.
