Binance Coin declines in value despite surpassing Ethereum in a key metric

Binance Coin (BNB) experienced a price drop on Monday, falling to $685, marking a 6.50% decrease from its weekend high. Despite this drop in price, the network achieved a notable milestone by surpassing Ethereum in a key metric. On January 20, 2025, BNB Chain decentralized exchanges (DEXs) recorded a daily trading volume exceeding $5.7 billion, surpassing Ethereum’s $5.05 billion. This marked the first time BNB Chain outpaced Ethereum in daily DEX volume, positioning BNB Chain as the second-largest network by DEX volume, after Solana, which processed $25.3 billion. This surge in volume on BNB Chain is significant, representing the highest daily increase since March 2021.

PancakeSwap, the largest decentralized exchange on BNB Chain, led the volume surge with over $5.24 billion in trades. Other platforms, including THENA, Uniswap, DODO, and Woofi, also contributed to the increased activity. This surge in decentralized trading volume reflects growing adoption of BNB Chain as a prominent network in the decentralized finance (DeFi) space, especially as Ethereum faces increasing challenges from layer-2 networks. The rise of Ethereum’s competitors, such as Base (launched by Coinbase), Arbitrum, and Optimism, has caused a shift in trader activity, with Base recently recording a weekly volume of $14 billion, though still trailing Ethereum’s $21 billion.

Despite BNB Chain’s impressive performance in the DEX space, BNB’s price remained in a tight range, impacted by broader market conditions and the ongoing political events surrounding Donald Trump’s inauguration. One of the key upcoming events that could influence BNB’s price is its next scheduled token burn, set to take place in the coming weeks. The 30th autoburn is expected to incinerate 1.64 million BNB tokens, valued at over $1 billion. The network regularly burns over 1.5 million tokens each quarter, and the burn amount is determined by the price of BNB and the number of blocks produced. The long-term goal of the burn program is to reduce the total supply of BNB from 144 million to 100 million tokens, which is expected to have a deflationary effect on the coin’s supply.

In terms of BNB’s price performance, the weekly chart shows a strong bullish trend over the past few years. From a price of $188 in 2022, BNB has steadily risen to $690, consolidating near the upper side of the “cup and handle” pattern—an indicator often associated with future bullish price movements. The coin has also moved above both the 50-week and 100-week moving averages, which are considered bullish signals. Additionally, key technical indicators like the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) are showing upward momentum, suggesting that BNB may be poised for a strong bullish breakout in the coming months.

With this technical setup, analysts predict that BNB could soon break through key resistance levels, potentially reaching new price targets of $1,000 and $1,135 based on the pattern. These price targets would mark significant milestones for the coin and further solidify its position within the top cryptocurrencies. However, short-term price fluctuations could still be influenced by broader market dynamics and ongoing developments within the DeFi and crypto space. As such, while the future looks promising for BNB, its price could continue to experience volatility in the near term.