Analyzing the Wealth Code of the Bull Market Golden Shovel BNB

Author: Biteye Core Contributor Viee

Editor: Biteye Core Contributor Crush
Community: @BiteyeCN

The full text is about 3,500 words, with an estimated reading time of 8 minutes
According to DeFiLlama data, the trading volume of DEX on the BSC chain surpassed that of DEX on the Ethereum chain on March 10, claiming the top spot.

Meanwhile, the price of BNB has increased by nearly 30% in the past week, and trading volume has also significantly risen. Its performance in 2024 has outpaced similar tokens, showing the largest increase among exchange tokens and leading among native tokens of public chains.

As the native token of Binance Exchange and the fuel token for BNB Chain, such remarkable enthusiasm naturally sparked bullish sentiment in the market regarding BNB as a golden shovel.

Why is the BNB token considered the golden shovel of this bull market? What wealth codes are hidden in this round of increase? This article will explore the immense potential and opportunities of the BNB token.

01****

Recent Price Increase of BNB

Recently, the price of BNB surged again, briefly breaking through 630 USDT, reaching a new high since December 2, 2021.

How strong is the momentum of BNB? Since the beginning of March, it has risen by 50%, with an increase of over 80% in the past 30 days.

Looking back at the last bull market, BNB once touched a historical high of 690.93 USDT, and then experienced price fluctuations between 200-400 USDT during 2022 to 2023. Currently, it is only 9% away from its historical peak.

Such an upward trend indicates that market concerns about Binance's regulatory issues have diminished. BNB has shown strong resilience after the turmoil, which has also helped to rebuild confidence to some extent.

Additionally, Binance Launchpool (new token mining) has provided crucial momentum for the rise of BNB.

02****

Binance Launchpool

Binance Launchpool is a service provided by Binance Exchange, where users can stake cryptocurrencies to earn token rewards from new projects. This section is also known as new token mining.

This process is somewhat similar to staking mining, except that the mined tokens cannot be traded immediately, and may include potentially high-quality projects. In other words, the exchange allows users to participate at a lower cost and risk to acquire new tokens that are about to be listed.

The rapid rise in BNB's price can be explained in various ways, with Binance Launchpool being an indispensable part. The mining rules are simple: users participate in mining by staking BNB and FDUSD to earn new token rewards. This empowers BNB through Binance Launchpool, directly impacting the core of the price increase.

For example, the newly launched on-chain derivatives exchange AEVO on March 6 significantly boosted the price of BNB.

In less than a week, BNB rose from 400 USDT to 500 USDT, attracting a large number of investors' attention and participation.

Looking back, Binance has launched 7 Launchpool projects frequently since the beginning of the quarter, with participation numbers ranging from hundreds of thousands to millions. Such a continuous influx of demand has naturally driven the price of BNB higher.
Launchpool Yield: Higher Returns for BNB

Currently, the staking cryptocurrencies used to mine new tokens in Launchpool are BNB and mainstream stablecoins. Biteye uses the staking data released by Binance to calculate the annualized yield of the complete mining cycle for projects launched this quarter.

1) Participating in Launchpool is a relatively safe and high-yield mining method.

2) The mining yield of BNB far exceeds that of the other two stablecoins, almost equivalent to their sum. Binance Launchpool can be said to be a "stable financial lottery" tailored for BNB holders.

Why is that? Let's take a look at the historical performance yields of Launchpool below.

1) Launchpool new token mining yield from Q1 2024 to present

2) Comparison of mining yields using different tokens

Note: The current price reference time is March 13, 19:00 (UTC+8)

1. From the APY of the past 7 Launchpool mining periods, the yield brought by the price performance on the day of listing averaged over 100%, with the highest yield from MANTA reaching 186.92%.

If betting on the historical highest price, the APY would double. Moreover, since the mining time is generally short, it greatly reduces the time users' funds are tied up. Therefore, participating in Launchpool can be considered a relatively safe and high-yield mining method.

2. From the overall increase ratios mentioned above, it can be seen that the new tokens launched on Binance Launchpool have almost all seen an increase of around 200%, with XAI's price reaching nearly three times its closing price on the listing day at its peak.

From the listed tokens, it is evident that there are many high-quality projects, which is one of the important reasons for the subsequent rise in token prices.

Most of these high-quality projects are issued through Launchpool, such as the highly anticipated derivatives trading platform AEVO, the dark horse in the chain game track Pixel, and the new star in the L3 gaming track Xai, all of which have strong fundamentals and user bases, and have potential for future development.

It can be said that the new token projects launched on Binance have performed well.

3. By comparing the three mining methods and calculating the yield brought by the price performance on the listing day, the mining yield of BNB is far higher than that of the other two stablecoins, almost equivalent to their sum.

Imagine, if you hold 100 BNB during a bull market and stake them in the pool with minimal effort, you could earn 1,000 USDT in just 5-7 days—a true golden shovel of the bull market.

03****

Platform Development

BNB has the dual concept of "platform token + public chain token," and its value mainly depends on the fundamental situation of the exchange behind it, as the saying goes, "It's good to lean against a big tree."

This also aligns with a basic rule: the development status of the platform directly affects the market performance of its token.
Market Share

From the perspective of market share, despite being affected by events such as the FTX incident in recent years, Binance's market share remains stable at around 50%, maintaining its position as the "top exchange" unaffected.

As shown in the chart below, Binance's market share has been steadily increasing since Q1. In 2023, Binance attracted over 40 million new users, accumulating 170 million registered users, an increase of nearly 30% compared to the end of the previous year.

Business Aspect

So, what kind of empowerment can Binance, which backs BNB, bring to it?

The answer is that the ceiling is high enough, and the imagination is vast. As the world's largest cryptocurrency exchange, Binance has not limited itself to its trading business in recent years but has been striving to create a comprehensive cryptocurrency ecosystem.

Firstly, Binance's investment in the exchange level can be described as "holding user needs in the palm of its hand," including upgrading Binance Square to retain more creators and active users. Over the past year, the number of creators on Binance Square has increased from 1,200 to 11,000, and the daily active users have risen from less than 700,000 to over 1.6 million.

Frequent launches of Launchpool projects allow users to achieve returns that surpass most financial products through new token offerings, leveraging brand effects to benefit users, thus enhancing user loyalty while achieving a win-win situation.

In October last year, Binance launched a copy trading feature, with a weekly average trading volume exceeding 2 billion USD over three months, gradually resembling a social trading platform.

Recently, Binance introduced Futures NEXT, allowing users to earn rewards by predicting tokens that will be listed on Binance contracts. The NEXT Pool showcases a curated collection of potential listing tokens nominated by users.

Most notably, in November last year, Binance introduced a Web3 wallet in the Binance app, making it easier for users to switch between CeFi and DeFi without cumbersome registration—just a one-click operation.

This update effectively lowered the entry barrier for new users into the Web3 ecosystem while also enabling existing users to perform on-chain operations more conveniently.

Additionally, in response to the hot user demand, the inscription market officially launched the Binance Web3 wallet on February 1.

The most recent update was on March 15, when the Web3 wallet completed the integration of the Solana network, helping users easily manage and trade Solana network tokens and access various dApps.

Undoubtedly, the exchange remains at the core of Binance's landscape, while Binance Labs, as the investment and incubation project line, plays a crucial role.

Binance Labs supports outstanding projects in accelerating development through industry-leading resources and funding advantages, alleviating their burdens of listing and liquidity building. This strategy attracts high-quality projects and teams, bringing more users to Binance, achieving a win-win situation, and promoting the prosperity of the entire ecosystem.

Over the past year, Binance Labs has mainly focused on the fields of Web3 chain games, DeFi ecosystems, and ZKP (zero-knowledge proof), contributing numerous application scenarios and business models, providing users with more diverse product options.

In addition to the aforementioned sectors, it is well-known that Binance's ecosystem expansion has also extended to public chains, forming a CeFi + DeFi closed loop.

BNB Chain has developed into a comprehensive DeFi system that includes multiple chains, integrating computing, storage, and Layer 2 technologies.

This is not just a single chain, but a comprehensive "all-in-one" multi-chain development, becoming an undeniable presence in the DeFi field.

Based on the thriving BNB Smart Chain, along with the decentralized storage platform BNB Greenfield, significant gains have been brought to the BNB Chain ecosystem.

At the same time, the introduction of the low-cost trading opBNB based on Optimism technology fills the gap of Layer 2, further significantly reducing the already low gas fees of BNB Smart Chain.

The BNB Chain 2023 annual report indicates that daily active users exceeded 1 million in the past year, showing significant growth. On March 10, the trading volume of DEX on the BSC chain reached 2.474 billion USD, ranking first.

The daily trading volume of DEX on the Ethereum chain was 2.038 billion USD, dropping to second place; the daily trading volume of DEX on the Solana chain was 1.361 billion USD, ranking third.

In the recent quarter, BNB Chain has undergone multiple directional updates:

Cheaper. The official plan is to double the transaction speed of opBNB and reduce gas fees by ten times.

More comprehensive. The introduction of the One BNB concept aims to integrate BSC, opBNB, and Greenfield into a cohesive ecosystem, ensuring seamless interaction between decentralized computing and storage solutions.

More airdrops. On March 13, BNB Chain launched the "Airdrop Alliance Program," which will issue retrospective airdrops to BSC and opBNB users, aiming to reward the community for their support of BNB Chain, reflecting BNB Chain's strong development of the on-chain ecosystem. As BNB is currently anchored to the total number of blocks produced by BNB Chain, the more active the on-chain ecosystem, the more promising the price increase.

It is foreseeable that a thriving multi-chain system will further become an important force in the DeFi public chain.

04****

Conclusion

In the Web3 field, Binance's business landscape has expanded over the years to cover many aspects: from core exchange functions to cloud services, PoW mining pools, staking services, and financial and payment solutions, as well as investment and incubation activities around Binance Labs.

At the same time, with the strong capabilities of BNB Chain in the DeFi field, Binance has achieved coverage in almost every important area.

That being said, BNB, as the only vehicle for value capture in the Binance ecosystem, possesses not only the imagination of a public chain token but also reaps the development dividends of Binance and BNB Chain, making its long-term value quite considerable.