Episode Transcript
[00:00:00] Out of cycle Update.
[00:00:03] Every opportunity is certainly a good opportunity. CryptoTalk FM My name is Leister, I'm your host. Just a quick update opinion piece, speculation, spitballing, theorizing.
[00:00:16] What's happening with the Binance Smart Chain token bnb? What's really going on with that token? Why is it jumping like crazy? I would remind people there was a time, not what a year, maybe a year and a half ago. So this is around the poof hair FTX chaos that BNB had crapped down. I want to say it got down to $100. Okay, so if you had bought and stacked and stacked and stacked, you had a 10x from where that was.
[00:00:44] BMB historically had been roughly around the 400, 500, 600 range and hadn't really gone significant because Solana has started to take away when pump fund and all these other garbage things spun up and now everybody could spin up a token in seconds. You don't really have to work that hard. There's a whole bunch of scams spinning around.
[00:01:04] Used to be in 2020 and 2021, especially 2021, the Binance Smart chain was the place to go if you wanted to launch token. Now there were builders, absolutely, but you didn't have the same slickness of the builder that you have now. We, we had to do a little bit of work to get the thing off the ground. I mean there was again builders, but not like the pump fund builders and the other builders that automate a lot of these process things.
[00:01:31] Things like the adding the liquidity, maintaining the requesting audits all a lot of these things have been simplified down to more of a science than what they used to do.
[00:01:43] The burn, burning half or burning a portion or creating mint mechanisms based on demand. All of these things that we take for granted now they were a little bit more difficult back then.
[00:01:57] So I think my, from what I see, the appetite for launching those tokens on the Binance Smart chain seemed to dwindle at a point roughly around maybe early 2024 ish, late 2023.
[00:02:12] So then what's causing this major pump? BNB just passed another all time high over 1200 bucks per when it was around $100.
[00:02:22] Well, there's a couple of points I want to talk about and then I'll get to the theory. Number one, you have to understand that BNB as the token has a very constrained supply, very constrained. It's less than 150 million last I checked. It doesn't have a lot of supplies. That's number one. When you have A heavily constrained supply, it is easier to hit those targets. It's easier to cause the token to go up. It's easier to get it to a point of price appreciation simply by way of the market cap. Because that's where the more your market caps go in, the greater your opportunity for price appreciation. Then as you see the volatility take place, FOMO's easier to cause the price to go to those all time highs because there's only so much supply. This is Supply and Demand101.
[00:03:06] So it didn't surprise me necessarily to see that that had happened. Now what I was curious about and remain curious about is again, is there any sort of real true root cause to the run other than CZ is goat? And I don't mean the token, the garbage token. I'm saying is there any other real true root cause? I don't have enough information as of this recording to give a definitive. I just wanted to spitball and put a theory out there and I'll share a theory from somebody else. They believed that ultimately what's happening with the Binance Smart chain is that a lot of the other tokens, because we had a crap across the board, Bitcoin went down, Ethereum went down, all the other alts went down. Yet BNB is going up. And it seemed kind of strange. And this person speculated that the Binance, you know, the exchange was liquidating those assets and using the liquidated assets to pump the BNB token. I don't know if that's really the case. I'm sharing what that person said, but I did notice that there was a message that came out from CZ that said something to the effect of there's no real liquidity pool to bnb. I thought that was odd because in order to do any sort of trade, liquidity is kind of part and parcel to it, naturally. So I did a little digging. The site's app, Nansen N A N S E N AI you can get there from coin market cap from the Explorers. You do have to dig for this one, but you go to the Explorer that gives a little bit more data than you would normally see on the radar Explorer side. Now there's gave a quote and this is probably where CZ's response came from that said that the trade volume for this was about 200,000 bucks as I record this, but the liquidity was only $160,000.
[00:04:48] And the definition from Nansen is quote the measure of how easily the token can be bought or sold without causing significant price impact. Stop. So what it's saying is this number, if this number is low, it's going to affect price to a significant degree, whether up or down, depending on what's going on. If this number is reasonably high, it helps to stabilize the price. Well, if I've got in this case for a BNB, a market cap of over $170 billion, but only a volume, alleged volume of only $200,000 and their quote for that is quote, total value of all token swaps in this period combining buy and sell transactions.
[00:05:32] Well, how can you have $170 billion in market cap but only $200,000 in trade volume, of which it creates a liquidity of only $160,000?
[00:05:45] Well, my, my spitball is that this would seem to indicate volatility that is manufactured. It is that something's happening somewhere that is purposely pushing the price in a certain direction.
[00:05:59] If I'm right, and I can't say that I am, but if I'm right, it means that it won't last. It means it's going to crap back down and I'm going to guess somewhere around the neighborhood, about 900 bucks. Ish. Then we have to look at it again and try to see does it go down even further because of the, you know, the drop? Does it cost selling pressure, the cell pressure is going to cause a cascade effect. If that weren't the case, I don't know if it is, but that's what you have to watch and assess and see what's going to happen from here. So what I'm saying is I think this is manipulation. I think it's manufactured, I think it's artificial. I think there's something that's purposely trying to push the price up, likely to prevent something from happening elsewhere.
[00:06:44] Do I think that some of these liquidations on the other tokens is being used to support that pump? No, I think it's just smart, wealthy players that are just kind of playing with the price right now to give the illusion that something is in a position that it not is not really. That's my theory on the BNB token. Keep an eye on it and see if Leicester's telling you the truth.
