Binance releases 11th Proof of Reserves, but is BNB about to crash?

• Binance conducts its 11^th snapshot of its proof of reserves.
• BNB is once again facing the possibility of sub-$200 prices based on historic price patterns.

Binance has been under a lot of pressure lately as regulators weigh heavily on the exchange. Well, the exchange has been working toward maintaining a healthy image despite the challenging environment.

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The latest efforts toward building trust among its users include the latest snapshot of its proof of reserves. The exchange revealed that it conducted the 11^th snapshot at the start of this month. Thus, revealing that it had 588,000 in BTC assets and 3.83 million in ETH assets. USDT assets were perhaps the highest at 15.31 billion.

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Binance releases its eleventh proof of reserve (snapshot date 10-1). Users’ BTC assets were 588k, an increase of 0.12% from a month ago; users’ ETH assets were 3.83 million, a decrease of 1.6%; users’ USDT assets were 15.31 billion, a decrease of 0.8%.https://t.co/jGCPnwd2PR

— Wu Blockchain (@WuBlockchain) October 5, 2023

So what does this mean in the grand scheme of things? At first, the figures might seem little considering the amount of volumes that it processes and the fact that they represent a very small proportion of supply. However, it is worth noting that the snapshot takes into account the assets that Binance holds in custody on behalf of its users.

We also observed that more people have been switching in favor of self-custody solutions, especially after the events of 2022. Meanwhile, Binance says that the proof of reserves means those who still rely on the exchange for custody services have their assets backed at a 1:1 ratio.

BNB’s historic pattern indicates a potential crash ahead

‌Switching gears, let’s take a look at how BNB has been fairing. The announcement regarding proof of reserves is unlikely to have any meaningful impact on the cryptocurrency’s price action. BNB’s price action has been showing signs of accumulation since 22 August to the present. One might assume that it will result in a bullish outcome but a similar pattern was observed between 12 June and 11 August.

The same price pattern suggested that BNB could be headed for another slippery slope. BNB exchanged hands at $209 at press time after tanking by over 5% from its weekly high. Its recurring pattern is observed down to the Relative Strength Index (RSI) and the Money Flow Index (MFI) which also resemble the June-August phase.

On-chain data revealed low confidence in the market, suggesting that trader sentiment might not favor a bullish outcome. BNB’s Weighed Sentiment metric slid substantially since the last week of September. The on-chain Volume also highlighted a lack of stimulation.

Source: Santiment

Read Bianance Coin’s [BNB] price prediction 2023-24

In summary, there is a high likelihood that history could repeat itself if the market extends its sluggish low-demand characteristics. Such an outcome will lead to BNB crashing over by 14% during the June-August crash. Just a 5% crash from its press time level could push it below the $200 price range.