Author: momo, ChainCatcher

With BNB surpassing the crucial $1,000 mark, BNB Chain has seen a surge in on-chain activity. On September 21st, its daily transaction volume reached a 30-day high, exceeding 16.5 million transactions. Meanwhile, BNB Chain and opBNB also became the public chains with the highest number of daily active users.

BNB Chain is gradually becoming an amplifier of market sentiment. From Jobless, Aster to Giggle and Sign, with the support of CZ, it has advanced from a "wealth code" to a "wealth code" manufacturing machine.

Furthermore, BNB Chain is also strengthening its fundamentals while the iron is hot, planning to reduce the cost of a single transaction to approximately $0.005 through network upgrades. Wall Street asset management giant Franklin also officially announced that it will expand its proprietary tokenization platform, Benji, to BNB Chain.

However, amidst the high prices and lively atmosphere, some long-term BNB holders did not choose to sell off in large quantities and exit the market in time.

Not many options

After BNB recently broke through $1,000, a Binance Alpha market maker, Kun, did not sell. He has held BNB since 2021, and 90% of his holdings are in BNB.

Kun rarely participates in other non-mainstream altcoins. "Since I don't know where to exit for the time being, I will hold BNB first to absorb the benefits of the interest rate cut."

However, as the staking lock-up period is lifted, Kun may consider withdrawing part of his holdings. This is because after the launch of Binance Alpha, the income of Launchpool has decreased, and Kun’s passive income has also shrunk.

Another BNB tycoon, Chen, has already sold 20% of his holdings and invested part of the funds in other platform coins. He also placed a small portion of the funds on the new hot meme on the BNB Chain.

Starting in early 2024, when the price of BNB was between $300 and $500, Chen gradually invested 50% of his holdings in BNB. After CZ's release from prison, Chen continued to increase his holdings. After recently selling 20% of his BNB holdings, BNB now accounts for 30% of his total holdings.

From May of this year to now, BNB has been rising steadily for nearly five months, from around $500. For Chen, taking profits at high points is standard practice. He avoided a significant sell-off because, firstly, he believes BNB Chain is still trending, and secondly, he lacks better options. "Bitcoin and Ethereum are growing too slowly, and I only dare to test the waters with small positions in other altcoins and Dogecoins."

Crypto KOL BigFang shared on Youtube that $1,000 is an important psychological threshold, and traditional over-the-counter funds are expected to enter the market after it breaks through.

In early September, Hong Kong's regulated exchange, OSL, opened BNB trading to professional investors, making it the sixth cryptocurrency to be listed on the exchange. Furthermore, several listed companies have established strategic BNB reserves, and VanEck and REX Shares & Osprey Funds have submitted applications to the US SEC for BNB ETFs.

Crypto influencer DaDaDaOrange revealed on Twitter that he has held BNB since the ICO and added another 1,000 BNB to his holdings when it hit a new high of $990. Even after the new high, BNB remained his third-largest holding, behind only Ethereum and Bitcoin.

In addition to continuing to hold BNB, he has also invested in the BNB Chain ecosystem, purchasing 1.4 million Aster tokens and declaring, "Hold Aster like I held BNB eight years ago."

Why can you hold the position for so long?

Compared to market sentiment factors such as CZ's possible return to Binance's leadership, the long-term BNB holders interviewed this time may be more concerned about BNB's token economic model, the team's leadership capabilities and other fundamentals as well as future incremental space.

1. BNB captures the real income of BNB

"From the perspective of the token economic model, BNB captures the real income of the BNB system." This is the most critical reason for Kun's holding.

According to Kun, on the one hand, BNB is repurchased and destroyed every quarter. This deflationary mechanism directly feeds back the exchange's profits into the token value. Through continuous token destruction, the initial supply of BNB has been reduced from 200 million to approximately 100 million, enhancing its scarcity and value.

Kun mentioned that CZ and his team hold some BNB, and these tokens will not flow into the market, which means that the circulating market value of BNB is lower than the data seen on the surface.

On the other hand, BNB allows projects to establish funding pools on the BNB Chain through Binance Alpha. These pools are built using BNB, resulting in a large amount of BNB being locked up. This mechanism is similar to Solana's split-stake principle, where locking up tokens reduces the circulating supply and thereby increases the token's value.

Holding BNB offers the added benefits of Launchpool, HODLer airdrops, and MegaDrop, making it quite attractive. This is a key reason why BNB holder Chen holds it long-term. Chen also mentioned that as a core asset in the Binance ecosystem, BNB can be used for trading fees, staking, new activities like airdrops, and BNB Chain ecosystem applications, giving it strong value capture capabilities.

2. "Bullish" CZ

The strategic and execution capabilities of CZ and the BNB system are also an important reason why everyone is generally willing to hold them for the long term.

Chen believes that Ethereum is more like a large company with a slow pace and reliance on external capital, while BNB Chain is like a proactive startup. Especially after CZ's return, the team has been constantly launching new projects and new gameplay, and there is always a way to shift market attention and funds to the BNB ecosystem.

Starting from CZ’s call for “test coin” TST in February, and then to CZ’s dog, Mubarak, CZ, who originally said he didn’t like memes, successfully transferred the community’s enthusiasm for trading memecoins from Solana to BNB Chain.

After the meme craze temporarily subsided, Binance Alpha sparked community trading of new Binance projects. Since then, there's been talk of the platform coin Four.meme and the BNB reserve strategy narrative. Last week, CZ changed his X account profile from "ex-@binance" back to "@binance" and then targeted Perp DEX, subsequently driving Aster's price up dozens of times. The CZ effect has also begun to sweep the community, with projects CZ interacts with, including those invested in by YZi Labs, becoming the community's new password.

Crypto influencer @yuyue_chris Yuyue also wrote on the X platform that after CZ's official "return," it really feels like you can make money with him, and "Binance has really understood the essence of assets this time."

For Kun, a technologist, after witnessing countless Ponzi schemes in the cryptocurrency world that deceive people through various means, including technological innovation, CZ is one of the few who feels his intentions are good. "CZ has long been financially independent, so his motivation is definitely not money. As a science and engineering man, he's active on the front lines, focusing on interesting content. I feel like he's more motivated by solidifying Binance's position."

3. Incremental space brought by traditional fields

The confidence in BNB holders stems not only from the vitality of the community but also from the gradual recognition and adoption of BNB in traditional sectors. This external validation has brought BNB a wider range of application scenarios and a huge amount of new capital.

In terms of application scenarios, Wall Street financial giants are gradually expanding their RWA businesses to BNB Chain. Recently, Franklin Templeton, the asset management giant with $1.6 trillion under management, expanded its tokenized products to BNB Chain. VanEck, another asset management giant, also partnered with Securitize to launch the tokenized Treasury bond fund VBILL on BNB Chain. Ondo Finance and xStock have also announced plans to introduce tokenized Treasury bonds and structured products to BNB Chain.

On the other hand, Binance Pay is also actively promoting its adoption in traditional commerce, and recently achieved its launch at 30,000 merchants in South Africa through a partnership with Zapper.

In terms of new funds, the BNB strategy treasury of traditional listed companies also brought structural buying.

• BNB Network Company (BNC) is currently the world's largest publicly listed company with a BNB reserve, holding over 410,000 BNB as of September 10th.
• Nano Labs (NA) plans to invest $1 billion in BNB over three years, aiming to hold 5%-10% of the total circulating supply. Its first-half financial report shows it already holds 128,000 BNB.
• Windtree Therapeutics (WINT) signed an agreement to use 99% of the raised funds to acquire BNB to strengthen its cryptocurrency funding strategy;
• Huaxing Capital invested approximately US$100 million in a special allocation of BNB assets
• …

In addition, the Kingdom of Bhutan's Gelephu Mindful City (GMC) Special Economic Zone has included BNB in its official list of strategic reserve assets, which means that the value and security of BNB have received attention and recognition at the sovereign level.

4. Binance faces reduced policy risks

In March of this year, Binance announced that it had received a $2 billion investment from Abu Dhabi’s state-owned capital, MGX. This was a very positive signal for Kun, as it meant that Binance had found a strong “protection umbrella.”

As the U.S. crypto environment becomes increasingly friendly this year, the policy risks faced by Binance are gradually being alleviated.

In May, the SEC filed to dismiss its lawsuit against Binance, Binance US, and CZ. On September 16, Bloomberg reported that Binance was in talks with the US Department of Justice to potentially end its compliance monitoring period, which began in 2023, early. This development has, to some extent, alleviated the market's biggest long-held concerns.

Under the global compliance trend, Binance has obtained regulatory licenses from about 21 countries and regions, including Dubai, Japan, the European Union and Southeast Asia, enabling its business to be built on a more compliant basis.

Conclusion

In the current uncertain market environment, long-term holding of BNB not only reflects investors' pragmatic tendencies among limited options, but also represents a vote of confidence in a continuously evolving ecosystem.

BNB's growth stems from multiple sources of value support. Its deflationary model feeds real revenue from the Binance platform back into the token's value, forming the foundation of its intrinsic value. Following CZ's return, ecosystem activity and project iteration have significantly increased, continuously attracting developer and user participation and fostering a virtuous cycle. Meanwhile, traditional financial institutions and listed companies are gradually incorporating BNB into their asset allocations or on-chain investments, driving structural capital inflows. Advancing global compliance processes also provide a more stable policy environment for long-term holding. Furthermore, on a technical level, the continuous optimization of BNB Chain network performance and the reduction of transaction costs have further enhanced the on-chain experience.

However, the investment risks of BNB cannot be ignored. It is still a cryptocurrency with highly volatile prices, which is affected by the performance of specific companies and ecosystems, and is highly sensitive to global macroeconomic sentiment.

Overall, BNB has gradually transcended the attributes of a traditional platform currency, transforming into a digital asset with an independent economic model and ecosystem. Its continued value will depend on the team's strategic capabilities and execution, the continued growth of its ecosystem projects, the effectiveness of its technological upgrades, and its ability to adapt to the evolving global regulatory landscape.