Bitcoin (BTC) has been the dominant cryptocurrency for a long time. Till recently, it has set the tone for the entire cryptocurrency market. That is however changing. While most of the Altcoins still follow the trend of Bitcoin (BTC). There are a few which are not following this trend. One of the most noticeable examples is Binance coin (BNB). Irrespective of the performance of Bitcoin (BTC) or the general cryptocurrency market, Binance coin (BNB) continues to trade on its own. It has been noticed by regular traders as well. The question is what is causing this disappearance of correlation.
Binance Coin (BNB) vs Bitcoin (BTC) – Why has the co-relation disappeared?
Binance coin (BNB) in many ways is different than other cryptocurrencies. Other cryptocurrencies might have blockchain applications, but Binance coin (BNB) in a way is an underlying asset. There are mainly three different reasons why Binance coin (BNB) has a life of its own rather than following the trend set by Bitcoin (BTC).
If you have been following Binance cryptocurrency exchange, it has been adding new cryptocurrencies to the trading platform regularly. Most of the other cryptocurrency exchanges launched new cryptocurrency pairs with US dollar. However, Binance not only launched new cryptocurrencies on its platform with the US dollar but also with Binance coin (BNB). As a result, if you use Binance extensively, it is better to keep your money in Binance coin (BNB). The ability to buy any cryptocurrency on the Binance platform with Binance coin (BNB) is fuelling its use. It is increasing the volume as well. It is one of the main reasons why irrespective of the market conditions, Binance coin (BNB) demand remains solid.
The fortunes of Binance coin (BNB) are closely related to Binance cryptocurrency exchange. In a short time, Binance cryptocurrency exchange has grown exponentially. It is the most famous cryptocurrency exchanges currently. It is one of the main reasons why Binance coin (BNB) has a life of its own. In the past year, most of the cryptocurrencies including Bitcoin (BTC) have been lackluster. If you look at the performance of Binance coin (BNB) it has been stellar. It indicates that the fortune of Binance coin (BNB) is closely related to the performance of the underlying asset that is the Binance cryptocurrency exchange.
The 3rd reason is that Binance is opening up new frontiers in the cryptocurrency industry. It is developing a decentralized exchange. When such a big exchange opens a new trading platform, it is bound to gain some traction. That is why, investors are holding up Binance coin (BNB) in the hopes that once the decentralized exchange generates a significant amount of volume, Binance coin (BNB) will gain benefit from the liquidity and increased demand.
While a couple of years earlier, almost all the cryptocurrencies followed Bitcoin (BTC) when it came to the trend but recently, Binance coin (BNB) seems to be having a life of its own. These are the three reasons propelling it forward irrespective of the general trend in the cryptocurrency markets.