BNB Chain DEX Volume Increases – Examining What This Means for BNB Price

  • The increase showed that attention was shifting back to the series.
  • Despite the increase in TVL, BNB price may fall to $580.

For the first time since May 2, the DEX trading volume of the BNB chain exceeded $700 million. This was according to Artemis data.

For reference, DEX is the acronym for Decentralized Exchange. Artemis, on the other hand, is an analysis platform for crypto metrics.

Has a new race started?

Before now, DEX volume on the blockchain had been declining since mid-April. Thus, the value has failed to reach or exceed $1 billion since that period.

However, the recent increase indicates increasing user activity on the BNB chain. For those unfamiliar, Binance [BNB] Is a cryptocurrency used for transactions on the network.

Therefore, low DEX volume may indicate a decrease in transaction activity on the chain.

BNB dex volume increase this weekBNB dex volume increase this week

Source: Artemis

Higher DEX volume indicates increased network participation, which indicates increased demand for the coin.

At press time the price of BNB was $593.70, representing a modest increase of 1.23% over the past 24 hours. If volumes on the chain continue to increase, the price action could see a correction.

But the coin has not experienced significant buying pressure recently. If this happens, a return to $620 could be possible.

In terms of on-chain volume, AMBCrypto observed a decline since May 10.

BNB's move may be wrong

Increasing volumes and rising prices suggest that the uptrend may continue. However, BNB's recent price increase coupled with decreasing volume indicates a weakness in the bullish trend.

Thus, a false breakout may occur in BNB. If this is the case, a drop to the $580 support level could be the next step for the cryptocurrency.

BNB price rises while volume shows weak signsBNB price rises while volume shows weak signs

Source: Sentiment

Another area analyzed by AMBCrypto was Total Value Locked (TVL). TLV is an indicator of the health of a network. With this metric, one can tell whether market participants are staking or locking assets on a protocol.

If TVL increases, it is an indication of perceived trust for a project. In this case, the value of the locked assets would have increased in anticipation of better yields.

However, the decreasing TVL shows that assets are being taken out, and participants do not believe that the protocol involved can deliver good rewards.

According to DeFiLlama, the TVL of Binance Smart Chain was $61.2 billion. A deeper look at the protocols within the chain revealed a significant increase within the past week.

BNB Chain TVL increasesBNB Chain TVL increases

Source: Defillama

Therefore, this increase across the board shows that participants are confident about the health and safety of the chain. However, the metric remains well below its peak in 2021.

Realistic or not, here is BNB's market cap in terms of BTC

Should TVL continue to rise, the price of BNB may follow suit, however, the potential prediction of $1,000 may only happen if the metric initially exceeds $10 billion.

If not, that forecast may not come true. Still, it's important to remember that other factors can also influence the price.

Next: Solana: Why $142 is an important support level for SOL price

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