BNB Chain follows Ethereum with latest upgrade: Any impact on price?
  • The latest upgrade could cause BNB Chain’s revenue to plummet, the data suggests.
  • The broad range of trader sentiment is positive, suggesting that BNB price may retest the $600 levels.

On June 20, BNB Chain, a decentralized blockchain ecosystem, released a major update. According to the chain, through BEP 336, users on the network will be able to transact with 90% reduced fees.

The disclosure coincides with Ethereum’s Dencun upgrade, which brought about a reduction in gas fees. Interestingly, BNB Chain did not deny that EIP4844 was the inspiration behind this. In this regard, the company explained:

“BEP 336 will significantly reduce the cost of transactions on the BSC network by eliminating the need to persistently store certain data types.”

Will this affect my bottom line?

However, it is important to mention that this development may affect the revenue of the BNB chain. AMBCrypto confirmed that at the time of writing, the project’s revenue has decreased compared to the 19th. Artemis Data.

BNB Chain Revenues Decline

Source: Artemis

In particular, fees earned from transactions make up a large percentage of revenue, so further cuts could lead to a further decline. The price of BNB is another metric that this development may affect.

At the time of writing, BNB is trading at $585.37, a significant drop from the all-time highs it hit a few weeks ago.

However, lower trading fees could mean increased demand for the BNB cryptocurrency, which could push the coin’s price closer to its all-time high of $720.67 again.

Either way, it is important to evaluate what is happening on your network. At the time of writing, AMBCrypto was investigating development activity.

Developments are improving and traders are planning to take profits

Development activity measures the work done in a project’s public GitHub repository. Increasing metricThis means that developers are committing more code to ensure new features ship.

However, the decline suggests efforts to refine the network have not yet peaked: BNB development activity has surged to its highest level since May 6, according to data from Santiment.

BNB Chain Development Improves

Source: Santiment

This signifies increased dedication from developers. In terms of price, this increase could be a bullish sign for the coin. Another metric to evaluate is the funding rate.

The purpose of evaluating this indicator is to see whether traders are viewing the upgrades as a catalyst for price increases.

According to Coinglass, BNB’s funding rate was 0.0020%. When the value of the indicator is positive, it means that the contract price is trading at a higher price than the spot price. In this case, trader sentiment is bullish.

On the other hand, negative numbers mean that the permanent price is discounted, and therefore trader sentiment is generally bearish.

Therefore, at the time of writing, the funding rate is Imply Longs are paying fees to shorts for keeping their positions open, so the average trader is expecting the price of BNB to rise.

BNB Chain Funding Rate

Source: Coinglass

Read Binance Coin [BNB] Price forecast 2024-2025

But for prices to rise, buying pressure in the spot market must increase.

If this happens, the price of BNB could rise above $600 in the short term. However, if it is invalidated, the price of the coin could fall to as low as $570.

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