Binance Coin (BNB), the eighth-largest cryptocurrency by market capitalization, opened on Tuesday in a severely negative area as a string of poor fundamentals scared investors away.<\/p>\n
BNB plunged by 5.78 percent, or $0.77, to trade at $12.65. The latest downside move came as a part of an extended bearish correction seen across the entire cryptocurrency market. Like BNB, top coins including Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP), too suffered intraday losses.<\/p>\n
On the whole, the cryptocurrency market had erased approx $16bn off its capitalization from Monday until 1523 UTC today.<\/p>\n
The entire cryptocurrency market had plunged by 8 percent from Monday | Source: TradingView.com, CoinMarketCap.com<\/p>\n
The rapid decline in the BNB price also came two weeks before the enforcement of the European Unions Anti-Money Laundering Directive (5AMLD).<\/p>\n
In retrospective, 5AMLD requires Europe-based cryptocurrency exchanges to register with the local authorities. It also orders them to perform KYC checks on all their users.<\/p>\n
Binance, which is based in Malta, do not impose strict KYC on users withdrawing less than 2 BTC. That leaves the exchange with two options: Either it can impose new regulations on its hundreds of thousands of traders, or it can decide to stop offering services to European clients altogether.<\/p>\n
Historically, geo-blocking users have not helped BNB, a de-factor reward token at Binance. Back in June, when Binance had announced that it would stop offering trading services to the United States citizens, the price of BNB had taken a toll.<\/p>\n
The token though established a year-to-date high of $43.15 but has since erased a large portion of its profits. As of 1523, it was changing hands at a 70 percent lesser price.<\/p>\n
The 5AMLD directive has prompted smaller cryptocurrency businesses, including Bottle Pay, which had raised $2mn earlier this year, to shut down. Irrespective of what Binance does, it would lose a huge chunk of traders that want to circumvent KYC checks.<\/p>\n
The latest shakedown has brought Binance Coin closer to testing its 78.6 percent Fibonacci level of $12.455 as support. So it appears, it is one of the last levels standing before BNB and a vast breakdown.<\/p>\n
BNB price is undergoing a vast bearish correction | Source: TradingView.com, Binance<\/p>\n
The prevailing bearish sentiment could see traders eyeing targets below the $12.45 support. Ideally, a break below the said level could have them open short positions towards $8.96, an interim downside target. A further breakdown, meanwhile, could have traders extend their shorts towards $4.086.<\/p>\n
Conversely, a pullback from $12.45 could open an attractive interim long opportunity towards the 50-daily MA in orange.<\/p>\n
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