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BNB breaks $700, yet bulls are still hesitant – Here’s why!
The recent surge of the cryptocurrency market has been nothing short of remarkable, with numerous altcoins making substantial gains. However, amidst this sea of green, Binance Coin (BNB) seems to be stuck in a rut. Despite breaking above the psychologically significant $700 mark, the token is failing to garner any significant traction from bulls.
At first glance, it may seem that BNB’s slow-and-steady breakout is nothing more than underperformance. After all, other top altcoins have been making double-digit gains, and it’s natural for investors to be drawn to these assets instead. However, a closer examination of the market reveals that there’s more at play here.
One possible explanation for BNB’s lack of enthusiasm from bulls lies in its failure to attract fresh capital. While nearly $140 billion in fresh capital has pushed the overall crypto market cap to an astonishing $1.47 trillion this week (37% of the total crypto market cap excluding Bitcoin [BTC] ), Binance Coin saw a relatively paltry inflow of just over $4 billion.
This divergence is concerning, as it suggests that investors are increasingly less interested in the asset. Furthermore, zooming out, BNB’s dominance has dropped to a five-month low of 2.60%, down from its mid-March peak of 3.40%. This decline in market share can be seen as reinforcing a slow bleed in positioning.
In terms of price action, it’s also worth noting that BNB’s recent move above $700 was not exactly impressive by historical standards. A 10% move on the month is certainly nothing to sneeze at, but when compared to the double-digit gains enjoyed by other top altcoins, it’s clear that BNB has failed to capitalize on its own momentum.
So, what does this mean for investors? It appears that capital is simply rotating into higher-beta plays. Data shows wallets holding over 10k BNB have hit a near three-month low, suggesting large holders are lightening up into strength. On the other hand, whale cohorts across top majors are pressing new highs, indicating that larger investors are actively seeking riskier assets.
The implications of this could be far-reaching. If the divergence between BNB and its peers persists, it risks getting sidelined at resistance while higher-beta alts lead the next leg up.
Source: ambcrypto.com
