Binance Chain Burns $916M Worth of BNB Tokens, Spark Speculations of a Possible Price Rally

Binance Chain has completed its 31st quarterly BNB token burn, removing $916 million worth of coins permanently from circulation. This move has sparked speculations of a possible BNB price rally

Binance Chain has completed its 31st quarterly BNB token burn, removing 1.5 million tokens, valued at approximately $916 million, from circulation. This move is part of BNB Chain’s vision to reduce the BNB token’s total supply to 100 million. Currently, the token's supply stands at 140.89 million.

The burning process is maintained via an automatic burn mechanism which BNB Chain has strategically set to reduce the coin supply. Each quarter, the system, introduced through the BEP95 proposal, calculates the number of tokens needed to be eliminated. This process is done based on the metrics such as BNB price and the blocks produced on the Binance Smart Chain (BSC) during the term.

The burning of 1.5 million BNB tokens this quarter is a testament to the seamless operation of the burn mechanism.

Announcing the latest token burn on X, Binance founder and former CEO Changpeng Zhao said:

"Another quarter, another token burn. Binance Chain has burnt 1,500,000 BNB, or about $916,000,000, leaving only 40,886,572.43 BNB to be burnt. The total BNB Chain tokens burnt to date is 100,000,000."

Following the news, some investors and analysts are speculating that this might spark a BNB price rally.

The BNB token price has yet to react to the latest burning activity. According to CoinGape's BNB price predictions, the token was set to reach a maximum high of $577.86. However, the token has surged past the trend and is now trading at $582.58, down 1.10% in a day.

Despite a 5.82% increase over the past seven days, BNB price has seen a notable decline of 7.2% in a month. Defying the bearish trend in its price, BNB has seen a positive sentiment among investors, which is evident in the 24-hour trading volume. The trading volume has increased by a $1.39 billion.

According to bullish predictions, BNB price is expected to halt further declines. The token aims to reclaim the $600 resistance level, seeking support above the 50-day Exponential Moving Average (EMA).

Despite a bearish momentum building around BNB, the MACD indicator remains resilient. A breakout above the descending trendline resistance could significantly increase the likelihood of BNB testing the next key resistance area around $635.