The data show that traders have mixed emotions from the future of the BNB with regard to regulatory issues of Binance and the new mandatory policy of KYC. Investors have reason to doubt, in particular, that Solana’s competitive smart contracts platform reached an all-time high on 18 August.
The move was partly attributed to a recent $ 70 million crowdfunding to support its decentralized exchange (DEX), Mango Markets, and the launch of the well-registered NFT project.
The BNB reacted negatively shortly after the exchange abruptly stopped trading in stock tokens on 16 July. At the end of July, too termination of trading in derivatives for European and Hong Kong Binance clients. On 18 August, the Dutch central bank De Nederlandsche Bank issued a warning against the exchange. The authority claims that the company does not act in accordance with the law countries on combating money laundering and terrorist financing.
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Premiums for BNB perpetual contracts have disappeared
Derivatives data provide a good overview of the positions of whales and professional traders at Binance Coin (BNB). Although long and short futures always match, their leverage may vary. By measuring the funding rate of perpetual contracts, it is therefore possible to determine how bullish or bearish these investors are.
It is usually counted every 8 hours, but some exchanges, such as FTX, have hourly rates. In neutral markets, the funding rate ranges positively from 0% to 0.03%. This figure is equivalent to 0.6% per week.
Between 11 August and 17 August, there was a slightly rising 0.10% positive funding rate, which, however, lost in recent days. Although this figure is completely different from the bearish negative indicator of 0.15% recorded at the end of July, it does not show confidence in leveraged traders.
Professional traders are still not bullish
Let’s look at quarterly premiums on futures contracts. Retailers generally avoid quarterly contracts. Mainly due to difficulties in calculating the futures premium or manually rewinding positions that are approaching their expiry date.
Unlike perpetual contracts, these fixed-date instruments do not have an adjustment of the funding rate. Any imbalance in demand is therefore reflected in the price difference compared to normal spot markets. Healthy markets should mention a premium of 0.2% to 1% in quarterly contracts.
The data confirm bear gap in mid-July. This was previously observed in the funding rate, as September futures contracts showed a 5% discount. The quarterly contract has been neutral in recent weeks, indicating a neutral to bear sentiment from professional traders. Derivatives indicators show zero signs of rising rates on the part of investors. Nevertheless, the price is rising and the BNB is also likely to be tied to the bullish wave of the crypto market.
