Apr 8, 2019 09:30 UTC
Apr 8, 2019 at 09:30 UTC
Binance Coin’s Unprecedented Rise Make Analysts Confused Whether to Go Long or Short on it
Binance Coin (BNB) is a local utility token for the cryptocurrency exchange Binance. The coin has performed exceedingly well in throughout 2019 and has seen its prices grow upwards throughout 2019. This unprecedented nature of the coin has got analysts confused on whether to go short or long on the crypto token.
BNB coin’s performance has been marvelous throughout 2019, and if we take Q1 into consideration, the price has risen up a massive 185 percent in three months, rising from $6.02 to $17.29. Another interesting finding of the data suggests, BNB coin has doubled its gains over BTC in any price rally. It means if BTC has gone up by 2 percent, then BNB has gone up by 4.
However, the recent April 2nd rally has changed that, while BTC rose up by a massive 25 percent, BNB coin has maintained a flat graph with a price jump of 10 percent. Thus, the behavior reinforces the fact that exchange coins perform better during the bearish trends.
Short BNB Coin Makes More Sense
It is quite common to be long about cryptocurrencies and many believe being short is only good for something like BNB. Since it is a utility token and famous due to its limited business model of “regulatory arbitrage” and its “minimal” know-your-customer (KYC) requirements.
Nick Tomaino, a former Coinbase employee feels shorting cryptocurrencies is a losing game. Nick also says the performance of BNB coin is due to the trust of people in the parent crypto exchange Binance. Binance’s working model and agrresive nature of adding new crypto tokens have allowed the exchange to gain 40 percent of the market share in just two years.
Apart from these, Binance has been able to generate a sense of trust among the investors and customers, by trying to be as transparent with its operation, despite being centralized in its consensus. Apart from that Binanace is not just a single company with exchange services to offer, it is actually a consortium of several companies like Binanace info, Binance academy, and Binance Launchpad.
This helps the firm to expand its roots beyuond the exchange service and help create a much better sense of satisfaction among the user base which subsequently helps in propelling its BNB token valuation.