As the market continues to decline, which assets are worth bottom-fishing? This article will analyze the investment value that transcends cycles in detail.

$BNB It is the only universal currency of Binance, the world's largest cryptocurrency exchange, and the only carrier of economic value within its ecosystem, directly reflecting the overall value of the Binance ecosystem. Currently, BNB ranks fourth in the cryptocurrency market with a market capitalization of $86 billion (excluding stablecoins).

Currently, crypto assets generally face unclear value capture paths; many tokens only stay at the governance function level, lacking direct correlation with the underlying project value. If one studies BNB's economic model, it becomes clear that platform tokens (e.g., BNB) are the most similar to traditional assets in the entire crypto ecosystem and are the assets with the highest value capture capability in the industry.

1. Introduction to the background of Binance Exchange

To understand the investment value of BNB, we must return to the essence - the market position of the Binance Exchange.

Since 2018, Binance has maintained its position as the world's largest exchange for six consecutive years. By the end of 2024, its average daily trading volume was already 10% higher than Nasdaq, twice that of the New York Stock Exchange (NYSE), and 16 times that of Coinbase.

In 2024, Binance's market share in the global spot market reached 40%, and its share in the derivatives market reached 36.8%, while the second-place Coinbase had a market share of only ~7%. Its net capital inflow over the past year reached $21.678 billion, exceeding the total of the next 10 exchanges combined ($15.9 billion) by 40%. This shows that Binance maintains a leading position in the entire industry.

2. BNB - The only embodiment of platform traffic value

BNB is the only embodiment of the traffic value of the Binance platform, with a clear value capture path, realized through dual drivers from both the demand side and the supply side:

  • Demand Side - Expanding BNB Use Cases: The application scenarios of BNB extend from the exchange to the BNB Chain ecosystem and can be practically applied to trading fees, public chain Gas fees, and other core functions. As on-chain activities grow, the demand for BNB continues to rise, forming a stable support.

  • Supply Side - Destruction Mechanism Drives Deflation: Binance buys back and destroys BNB through quarterly revenues, continuously reducing the market circulation, creating a deflationary trend on the supply side, thus forming long-term support for the price.

Looking back at the price performance over the past year, it can be seen that in this cycle, BNB's increase is close to that of Bitcoin, leading for most of the time:

  1. According to historical data tracking from CoinMarketCap, since the listing of the Bitcoin ETF on January 11, 2024, the BNB price increase curve has consistently led BTC for over 60% of the statistical period;

  2. The maximum increase during the cycle reached 175%, almost on par with BTC (183%), far better than Ethereum's performance during the same period.

3. BNB's 'US Stock Genes': Deflation + Accumulated Earnings Dual-Driven Appreciation Potential

The value growth logic of BNB comes from two characteristics - the buyback and destruction mechanism and the dividend-like attributes, which are very similar to core assets in the US stock market, endowing BNB with long-term appreciation potential.

  1. Buyback and destruction mechanism (Asset Attribute)

    1. BNB is the only asset among the top 10 cryptocurrencies with actual deflationary attributes; as of now, the total supply has decreased by nearly 30%, with an annual deflation rate of 4.77%;

    2. If the driving force behind the long-term rise of US stocks comes from strong profitability + stock buybacks, then BNB is the closest value expression to traditional finance in the field of digital currency, being the crypto variety with the most US stock genes;

    3. BNB achieves deflation through a series of buyback and destruction mechanisms, similar to the market value management behavior of listed companies in the US stock market - buying back and canceling stocks, enhancing shareholder equity, and achieving asset appreciation.

  2. Dividend-like mechanism (Tool Attribute)

    1. BNB holders can obtain continuous asset increments through channels such as BNB Launchpool, Megadrop, and HODLer;

    2. By adopting a BNB-based reinvestment strategy, the overall return rate for holding BNB in 2024 reached284%(price increase + new issuance income), far exceeding the 183% of Bitcoin during the same period.

Therefore, for BNB holders, holding BNB assets during bull market cycles can achieve a Davis Double Effect, while in bear market cycles, it can supplement cash flow, making it one of the varieties in crypto assets with cross-cycle holding value. Thus, during the last cycle's bull-bear transition, BNB demonstrated the best resistance properties among mainstream coins.


4. Future Outlook: Why We Remain Optimistic About BNB

  1. The business model constitutes a positive flywheel

    1. Platform Empowerment for BNB: As a top exchange, its influence in the industry can better empower BNB, accurately directing platform growth dividends to BNB holders and rewarding loyal users of the platform.

    2. BNB, as a type of quasi-accumulation asset for the platform, retains users and funds, feeding back into platform growth: BNB's wealth effect further helps retain users and funds, attracting asset increments and accumulation.

  2. Binance's super operational capability and frequent actions

    1. Technical Side: BNB Chain upgrades, AI ecosystem construction, and improvement of Meme infrastructure;

    2. Content Side: Binance Square updates, introduction of KOL real-time holding functions, enhancing community stickiness;

    3. The next step may be to integrate Web3 wallets, strengthening on-chain social and following functionalities.

  3. Policy risk recedes

    Recently, Binance reached a settlement with the US SEC, reducing compliance risks and clearing obstacles for future development.


Conclusion

BNB is not only an exchange token but also the most valuable crypto asset in terms of value capture capability. Whether in a bull market with wealth effects or in a bear market with resistance to decline, BNB has demonstrated investment value that transcends market cycles.