In recent days, the cryptocurrency market has been gripped by fear and uncertainty as the correction in Binance Coin (BNB) continues.
This comes on the heels of Bitcoin’s drop below $29.1k last week, a move that sent shockwaves through the market. Notably, BNB’s price has now fallen below the 200-weekly Moving Average (MA) for the first time in its history, prompting concerns about a potential altcoin capitulation.
Adding to the complexity, BNB plays a pivotal role for numerous altcoins utilizing the BEP20 and BEP2 token systems.
Binance Faces Regulatory Pressure
The prominent cryptocurrency exchange, Binance, has found itself under relentless regulatory scrutiny since the collapse of FTX and Alameda Research late last year.
The situation escalated in March when the United States Commodity Futures Trading Commission (CFTC) filed a lawsuit against Binance, alleging that the exchange was operating illegally and lacked proper compliance measures.
This legal battle was followed by another blow as the US SEC charged Binance and its CEO Changpeng Zhao (CZ) with violating securities laws.
The mounting regulatory pressure, particularly from the United States, has resulted in Binance losing key partnerships that facilitated fiat-to-crypto on-ramping.
A case in point is London-based credit card processing company Checkout.com, which cut ties with Binance, citing concerns over regulatory actions, orders within relevant jurisdictions, and inquiries from partners.
BNB Price and Market Outlook
In a bid to counteract the escalating sell pressures, the Binance team has turned to Bitcoin for support.
Being one of the largest holders of Bitcoin, Binance has developed substantial infrastructure to bolster BTC liquidity.
Recent reports suggest that the Binance team has resorted to selling Bitcoin over the past few days in a bid to prevent further declines in BNB’s price.
As per the latest crypto market data, BNB’s price hovered around $210 during the early London trading session.
From a technical standpoint, there is a realization among crypto traders and investors that if BNB’s price loses its current support level, the potential for capitulation in the coming months looms large.
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