Binance Burns $914 Million in BNB Tokens, Supply Reduction Continues

Binance Chain has completed its 31st quarterly BNB token burn, eliminating 1.6 million BNB tokens, valued at approximately $914 million. This action is part of Binance’s strategy to reduce the supply of BNB tokens to 100 million. As the supply decreases, the resulting scarcity could drive the BNB price higher over time, particularly if market demand increases.

The automatic token burn, implemented through Binance’s BEP95 proposal, reduces the BNB token supply every quarter. With about 146 million tokens remaining in circulation, the latest burn brings the network closer to its target. This reduction in supply could boost long-term confidence in BNB. However, the BNB price currently faces short-term resistance levels around $635, with the token sitting below key Exponential Moving Averages (EMAs).

Despite the optimism surrounding the token burn, short-term technical indicators suggest caution. The Relative Strength Index (RSI) hovers at 45, indicating weak buying pressure, and the Moving Average Convergence Divergence (MACD) has not confirmed a strong reversal. While the long-term impact of a reduced BNB token supply could be positive, the BNB price is currently stuck in a range, needing a breakout above $584 to avoid slipping further.

Even with these challenges, the reduction in supply and the potential for increased demand could set the stage for a future rally. The BNB price on a 5-minute chart highlights a significant shift in momentum following a breakout from an ascending channel. The price tested the $586 resistance multiple times before breaking out but failed to hold above it, sharply reversing into a descending channel. This downtrend was accompanied by successive death crosses on the MACD and oversold RSI readings, confirming bearish momentum. Eventually, the price found strong support near the $577 level, which held firm on multiple retests, forming a key horizontal support zone. Notably, the RSI touched oversold territory several times around this level, signaling weakening bearish pressure. The MACD also began showing golden crosses near this support, suggesting potential reversal setups.

Following the support bounces, the BNB price entered a sideways trading range between $577 and $584, reflecting short-term consolidation. The RSI recovered toward the midline, and the MACD recently printed another golden cross, both hinting at building bullish momentum. However, repeated death crosses on earlier rallies above $582 indicate that buyers struggle to sustain strength. The price now hovers near the mid-range of this zone, and a clean break above $584 could invite a retest of the $586 resistance area. Conversely, losing the $577 support could push BNB into new lows.

Binance’s massive $914 million BNB token burn has sparked some optimism, especially with the long-term goal of reducing the supply to 100 million. This kind of scarcity could set the stage for strong price growth. However, in the short term, the charts tell a more cautious story. BNB is still struggling to push past key resistance at $586, and recent bearish signals suggest that buyers aren’t fully in control yet. While indicators like the MACD and RSI are starting to lean bullish, the price is still stuck in a range. For now, traders should stay alert and wait for a clear breakout above $584 or a drop below $577 before making any big moves.