BNB Chain TVL Slumps 24% In Q2, Yet Vital Metrics Surge In Double Digits
01 August 2024 - 5:00AM
NEWSBTC
The BNB Smart Chain (BSC) experienced a mixed performance in the
second quarter (Q2) of the year as the broader cryptocurrency
market cooled off after a strong price surge in March. While BNB,
the native token of the BSC, remained mostly flat, down 5%
quarter-over-quarter (QoQ), the network’s key metrics showed both
positive and negative trends. Binance Smart Chain Revenue Plunges
According to a recent report by market intelligence platform
Messari, the chain’s revenue, which measures the total fees
collected by the network, fell 28% QoQ to $48.1 million during Q2,
although it was only down 8% year-over-year from $52.4 million in
Q2 2023. According to the report, this decline was largely
driven by the decrease in BNB’s price, as revenue in the network’s
native token terms declined 51% sequentially from 165,100 BNB to
81,300 BNB. Related Reading: Analyst Says ETH Price Will Struggle
As Spot Ethereum ETFs Expectations Crash The report also
highlighted a decline in network activity, with average daily
transactions decreasing 10% QoQ to 3.7 million and average daily
active addresses dropping 18% QoQ to 1.1 million. This trend was
not isolated to the BSC, as on-chain activity decreased across most
smart contract platforms in Q2 following a strong Q1. Despite the
overall decline, the report noted notable shifts in user
preferences within the BSC ecosystem as decentralized exchange
(DEX) Uniswap experienced a significant increase in daily
transactions, up 630% QoQ, while the previously dominant
PancakeSwap saw a 46% QoQ decrease. Staking Surges 30%, TVL
Drops Messari also highlighted that the total BNB staked
increased 30% QoQ to 30.4 million BNB, with the total dollar value
of staked funds increasing 24% to $17.7 billion. This ranks
the Binance Smart Chain as the third-highest Proof-of-Stake (PoS)
network by staked value, though it still lags behind the Solana
blockchain by a significant $38.4 billion. The BSC’s decentralized
finance (DeFi) ecosystem, however, saw a decrease in total value
locked (TVL), down 24% QoQ to $5.5 billion, primarily driven by a
41% QoQ drop in borrowing on the DeFi protocol, Venus
Finance. The company notes that this indicates that the
overall decrease in value locked was partially due to the drop in
value of the BNB token, which closed the quarter at a low of $567
after reaching an all-time high of $722 in March. Despite these
fluctuations, Messari reported that the Binance Smart Chain
maintained the third-highest decentralized exchange (DEX) trading
volume during the second quarter of the year, with $66 billion in
total volume, trailing only Ethereum (ETH) and Solana. BNB Price
Analysis At the time of writing, the BNB token was trading at $586,
up over 2% in the last 24 hours. However, trading volume in the
last 24 hours was down 3% to $830 million, according to CoinGeko
data. Since Friday, the token has been consolidating between
$570 and the current trading price, following the lead of the
largest cryptocurrencies on the market, after a failed attempt on
Monday to break through its nearest resistance wall at $590, which
is the last obstacle preventing a move upwards to the $600
milestone. Related Reading: Elliot Wave Theory Suggests
Bitcoin Price Will Crash Below $40,000 Conversely, the key level to
watch for BNB bulls is the 200-day exponential moving average (EMA)
noted on the daily BNB/USDT chart below, with the yellow line just
below the current price, which could act as a key support for the
token, potentially preventing further declines. Featured
image from DALL-E, chart from TradingView.com
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