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One of the most-awaited events in the crypto space is the burning of Binance Coin (BNB) by the Binance exchange. This is a quarterly event that has made somewhat of a difference in the value of the digital asset in the past.
Binance has now completed its 16th quarterly BNB burn. However, this time the price of the digital asset has not reacted as it did in the past. This has led crypto enthusiasts to wonder what could be the possible reasons for this price reaction.
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What to Know About BNB Burning and More?
Burning crypto assets quickly remove them from the market, which increases their relative scarcity. The last burning completed by Binance was in April when the exchange burned around 1,099,888 BNB. The cumulative value in USD was around $600 million.
This time Binance has burned more Binance Coin, which was around 1,296,728 BNB or approximately worth $393,673,653.
Previously, the price of the digital asset has been noted to increase to some extent in response to the burn. However, this time the BNB has remained unaffected.
Why is there no increase in BNB’s price this time around?
One of the possible reasons for the unaffected price of BNB is the current market situation that seems to be somewhat stagnant.
It has been further reported that Binance has switched to a new burning scheme. Due to this, the 16th BNB burn cannot be reversed to determine the profit of the company.
The CEO of Binance, Changpeng Zhao, also shared a tweet that stated an additional 16 million BNB has been unlocked and moved to a team address. He has also clarified that the Binance team has never used or sold any of the Binance Coin but instead has always burned them.
What Should Crypto Investors and Traders Do?
You must be quite familiar with the current market situations, whether you are new to the crypto space or not. The prices of the top two crypto assets, Bitcoin and Ethereum have been noticeably fluctuating.
- Bitcoin is currently trading at $31,701 (at the time of writing).
- Ethereum is currently trading at $1,902 (at the time of writing).
However, these are not the only two digital currencies that are facing some serious ups and downs in price. Binance Coin is one of many crypto assets that is finding it difficult to be stable at the moment.
Here is a graph by CoinGecko, tracing the price of BNB in the last month.
However, if you are new to the world of crypto and you intend on investing in a digital currency, it is helpful that you take your time and carefully choose a crypto asset to purchase. Above all else, make sure you use the best crypto exchanges to minimize the risks.
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