BNB Smart Chain (BSC) reported mixed results in the second quarter of the year as the broader cryptocurrency market slowed following a robust price rally in March. While BNB, BSC’s native token, remained mostly unchanged, down 5% quarter-on-quarter (QoQ), the network’s value Key Indicators showed both positive and negative trends.
Binance Smart Chain revenues plummet
According to a recent report The network’s revenue, a measure of total fees collected by a network, fell 28% quarter-over-quarter to $48.1 million in the second quarter, although year-over-year it was down only 8% from $52.4 million in the second quarter of 2023, according to market intelligence platform Messari.
According to the report, the decline was largely due to a decrease in the price of BNB, as revenue from the network’s native tokens dropped by 51% from 165,100 BNB to 81,300 BNB.
The report also highlighted a decline in network activity, with the average daily transactions down 10% QoQ to 3.7 million and average daily dynamic addresses down 18% QoQ to 1.1 million. This trend was not confined to BSC, as on-chain activity declined across most astute contract platforms in Q2 following a robust Q1.
Despite the overall decline, the report noted significant changes in user preferences in the BSC ecosystem, as decentralized exchange (DEX) Uniswap saw a significant enhance in daily transaction volume, up 630% quarter-on-quarter, while previously dominant exchange PancakeSwap saw a 46% decline quarter-on-quarter.
Staking increases by 30%, TVL decreases
Messari also highlighted that the total value of BNB staked increased by 30% quarter-on-quarter to 30.4 million BNB, while the total value of funds staked increased by 24% to $17.7 billion. This classifies Binance Smart Chain as the third-largest Proof-of-Stake (PoS) network by stake value, though it still lags behind the Solana blockchain by a significant $38.4 billion.
However, BSC’s decentralized finance (DeFi) ecosystem saw its total value locked (TVL) decline by 24% quarter-on-quarter to $5.5 billion. This was mainly due to a 41% quarter-on-quarter decline in loans taken out on its DeFi protocol, Venus Finance.
The company notes that this indicates an overall decline value locked was partly due to the decline in the value of the BNB token, which closed the quarter at $567 after reaching an all-time high of $722 in March.
Despite these fluctuations, Messari reported that Binance Smart Chain maintained the third-highest trading volume for a decentralized exchange (DEX) in the second quarter of the year, with a total trading volume of $66 billion, trailing only Ethereum (ETH) and Solana.
BNB Price Analysis
At the time of writing, the BNB token was trading at $586, up more than 2% in the past 24 hours. However, trading volume in the past 24 hours fell 3% to $830 million, according to CoinGeko data.
The token has been consolidating between $570 and its current trading price since Friday, trailing the market’s largest cryptocurrencies after failing to break through in the coming month retaining wall at $590, which is the last hurdle preventing it from reaching the $600 mark.
On the other hand, a key level to watch for BNB gains is the 200-day exponential moving average (EMA) highlighted on the BNB/USDT daily chart below, with the yellow line sitting just below the current price, which could provide key support for the token and potentially prevent further declines.
Featured image from DALL-E, chart from TradingView.com
