Binance-CFTC FUD puts BNB price at risk of drop toward $200
BNB (BNB) looks set to wipe out its March gains entirely as investors turn their attention to the latest regulatory crackdown on Binance, the world's leading crypto exchange by volume.
On March 27, the U.S. Commodity Futures Trading Commission sued Binance and its chief executive Changpeng Zhao (CZ), alleging that the company illegally offered crypto derivatives services to Americans and facilitated illicit financial activity.
BNB dropped by over 5.5% to $305 on the announcement day, logging its worst daily performance since Feb. 13, when its price dropped by over 5.8% due to another regulatory crackdown involving Binance-branded stablecoin, BUSD.
BNB's price stabilized on March 28, wobbling between gains and losses as CZ refuted CFTC's allegations. However, the BNB/USD pair risked falling further if one considers its recent response to regulatory actions.
For instance, the New York regulator's BUSD crackdown in February 2023 preceded a 15%-plus BNB price decline.
Similarly, BNB plunged by up to 10.75% after the Dutch Central Bank slapped a $3.4 million fine on Binance in July 2022 for offering unlicensed crypto services. It also dropped 25% in February 2022 after Binance halted its operations in Israel, fearing a crackdown.
The Binance-CFTC FUD has triggered a bearish reversal setup previously covered in February.
Related: Here’s how Binance is mitigating its stablecoin needs after BUSD ban
This setup involves a rising wedge pattern whose breakdown could lead to a 25% price correction toward $250 by the end of March. The March banking crisis and its positive impact on top-ranking crypto assets may have delayed the bearish call.
Simultaneously, BNB eyes an extended price decline toward $200 due to the formation of another
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