BNB Price Tumbles Amidst CEO Shake-Up and Legal Turmoil

BNB price has recorded significant losses over the past week on the back of the legal action against Binance and its former CEO. The Binance Coin has dipped by more than 10% in the past week and 8.25% in the year to date. Its total market cap has declined to $34.4 billion during this period, while the total volume of the BNB token traded over the past 24 hours increased by more than 10%, suggesting either an increase in buying or selling of the token.

End of the Road?

BNB price has been steeply downward for the past few days amid Binance’s legal battles. Binance’s position at the top of the cryptocurrency market has been under duress after the former chief executive officer, Changpeng Zhao, pleaded guilty to federal criminal charges presented by the US Department of Justice.

Zhao pleaded guilty to a US criminal charge of failure to protect against money laundering after federal prosecutors lay open a sweeping case against Binance. The world’s largest cryptocurrency exchange was also charged with violating the Bank Secrecy Act by failing to implement an effective anti-money-laundering program and breaching international financial sanctions. Binance agreed to pay the US government $4.3 billion in fines, ending a yearlong investigation into the company.

According to data by Nansen, outflows from Binance, not including Bitcoin, have amounted to more than $1 billion since Wednesday last week, following Zhao’s plea and ouster from Binance. Liquidity has dropped by more than 25% over the same period as traders pull back their positions. The outflows are significant and almost similar to June when the SEC charged the exchange with 13 security violations.

The exchange’s native token, BNB, has been reacting to the recent events, dropping to its lowest level since the start of the month. According to Nansen, Binance holds around $2.8 billion worth of BNB tokens. Notably, the exchange contains over $65 billion worth of assets on its platform, meaning that it is capitalized enough to withstand the current storm.

BNB Price Analysis

The daily chart shows that the BNB price has been on a downward trajectory over the past few days, shedding more than 10% of its value. The digital asset has dropped below the 50-day and 200-day exponential moving averages and the 50-day and 200-day simple moving averages. Its Relative Strength Index (RSI) has moved below the signal line and neutral zone, highlighting increased selling pressure. Its Moving Average Convergence Divergence (MACD) indicator has also been bearish.

As such, the Binance Coin price will likely continue moving lower in the ensuing sessions as bears eye the immediate support at $220. A drop below this level would have the price on a freefall to the support level at $214. Conversely, we cannot rule out a breakout above the 50-day EMA at $233, which might fuel a price reversal.

BNB Price Chart