BNB rate explosion of 670% – Binance and the DeFi lie
Tokens from the Binance Smart Chain (BSC) ecosystem are out of bounds. On the BSC, BNB is the equivalent of ETH on the Ethereum blockchain. It is therefore hardly surprising that the BNB price has exploded. Many are already saying of Crypto Wealth that BSC is proof that Ethereum has failed. Rightly so?
In this article, we take a closer look at what is behind the current hype and whether BSC could really pose a threat to Ethereum.
BNB price rises by 670
The weekly chart reveals what explosive momentum the BNB price has developed in recent weeks. In just 3 weeks, the price of Binance’s native cryptocurrency has shot up from around $44 to as high as $344. This corresponds to a crazy price increase of 670% and places BNB directly behind Ethereum (ETH) in third place among the leading cryptocurrencies in terms of market capitalisation.
Currently, the BNB price is trading at $294 and many believe that this is not the end of the road.
One of the main factors contributing to BNB’s appreciation is the growing number of other projects based on the Binance Chain and especially BSC. First and foremost is PancakeSwap, a Uniswap clone in the Binance ecosystem. But this project is not an isolated case, as the following table shows.
Projects on the Binance Smart Chain
The high transaction fees on the Ethereum exchange have driven yield-hungry investors straight into the realm of CZ, where transactions cost a fraction of what current gas fees on Ethereum demand from users.
Don’t fight the inevitable, embrace it.#BTC #BNB pic.twitter.com/6hvbIROyDE
– CZ 🔶 Binance (@cz_binance) February 20, 2021
Is flippening between Binance and Ethereum looming next?
Users are flocking to BSC in droves to chase the sometimes triple-digit returns and benefit from the relatively very low transaction fees. More and more often you hear, „Binance is in, Ethereum is out!“
The displeasure of many smaller investors with the astronomically high transaction fees on Ethereum is too great, pushing them to the sidelines of the action and demoting them to observers of it all. Understandably, this causes anger and makes people doubt Ethereum. The BSC is a very tempting alternative. It is currently trendy, fast and cheap and can therefore score points against the grandfatherly Ethereum with its slow and no longer timely transaction fees.
CZ, as an intelligent businessman, is taking advantage of Ethereum’s scaling problem and the hype around DeFi to tailor a suitable narrative for his own product: BSC as the driver of DeFi.