Unlocking Binance-Smart-Chain (BNB) Potential: Insights into Growth and Trends (March 2024)
Dive into the intricate dynamics shaping Binance Smart Chain’s rise to the forefront of blockchain platforms. Discover how fee adjustments, innovative projects, and stable user engagement are steering the platform towards sustained success amidst evolving market pressures. Stay ahead of the curve in the dynamic world of blockchain innovation with actionable insights from this review. A must-read for blockchain enthusiasts seeking a deeper understanding of Binance Smart Chain’s competitive edge and future potential.
Below is presented the Latest analytics on Binance-Smart-Chain blockchain for February 2024.
Visit blockchainmetrics.online for more analytical materials.
Binance-Smart-Chain (BNB) in February 2024 ranks 1st in the ranking of leading blockchain platforms based on the sum of key indicators. This position is maintained due to the most developed ecosystem of decentralized applications which is the result of high blockchain throughput, low transaction costs for end users and compatibility with existing Ethereum tools and infrastructure, and the highest daily activity of active wallets.
(1) In February, the number of active wallets decreased slightly. But this is not a significant change, rather within the measurement error. It is worth noting that after the rise in user activity in December 2023, the value of this metric remains approximately unchanged.
(2) With the volume of transactions, the situation is similar to the situation with the number of active wallets. After an incredible rise of almost 85% of this indicator in December, during January and February 2024 the metric, with minor fluctuations, remains at a given high level.
We cannot now provide an analysis of what caused the sharp increase in active wallets and transactions in December 2023, but the current state of affairs with the number of active wallets and the volume of transactions carried out by these wallets indicates that market of demand for the services provided by Binance Smart dApps Chain, has reached saturation levels, at least in the short term, and further growth may require new developments or innovations to attract additional users and increase transaction volume. A slight adjustment towards a decrease in these indicators may be a warning about the beginning of a trend of declining demand. In this context, it is worth paying sharp attention to the increase in the average cost of one transaction over three months in fiat currency, from approximately $0.08 in December to $0.15 in February.
(3) With all this, platform fees for transactions decreased by 5.41%. This indicator cannot be ignored. Especially when you consider that over the past two months, after the turning point of December 2023, fees which are collected fell by 27% in total
(4) Further, if you look at the average transaction cost, the average transaction cost on the platform also decreased in February. By 3.68%. But this is a good point, given that in January this figure increased by as much as 40%. However, the platform continues to lose its appeal as a platform with invisible transaction costs. Among the top platforms, Polygon and Solana are already many times more attractive in this parameter than Binance-Smart-Chain. This is a dangerous trend that platform’s developers will have to deal with in the coming months.
Taken everything together, it is likely that in response to market pressure from the explosive growth in the value of the BNB token and increased demand for transactions, the platform has adjusted its fee structure to remain attractive to users and developers. In addition, the stable level of daily active wallets and transaction volumes, along with higher fees, may indicate that users are responding to the significant increase in the cost of using platform in the fiat currency for themselves and are becoming more efficient and frugal in their transactions. They may consolidate transactions or use optimization techniques to minimize fees while maintaining activity levels.
As a result, there is the current situation: the explosive growth in demand for platform services in December 2023 led to a sharp increase in active wallets and transactions and, consequently, to a rapid increase in the average cost of one transaction. We must not forget that at the same time there was an increase in the cost of the native token. The platform developers probably optimized the fees in the native token to maintain the attractiveness of operational performance. At the same time, in fiat currency, the cost of transactions and platform revenues have increased. End users began to respond to this by decreasing activity.
Whether the platform developers will be able to cope with these factors is a very interesting question.
(5) The number of platform validators is unchanged, since Binanse independently selects validators and maintains their number at 40. Market factors do not affect their number in any way.
The number of tokens that have been staked over the past three months has also was remaining at the same level.
The stability of staking BNB tokens reflects balanced market dynamics, in which incentives for staking BNB remain relatively constant over the observed period. There are currently no factors (such as changes in tokenomics, network usage or market conditions, participation of institutional investors, etc.) that could lead to significant changes
(6) Binance-Smart-Chain can offer end users a truly developed ecosystem of decentralized applications. The platform contributes to develop not only applications in the DeFi category.
Currently, Binance-Smart-Chain confidently leads in the number of projects. In February 2024, the leaders in the dApps categories were DeFi, Social, Games, and AI Tools.
With such diversity, it is not surprising that the average number of active wallets per day is at a sky-high level for blockchain projects of 1.2m pieces.
Among the projects, it is worth noting QnA3 — AI Q&A service to comprehend user queries about web3 industry in general and DeFi in particular, AI trading assistant. This project increased user activity by 23.76% in February.
It’s also worth paying attention to StarryNift. A blockchain-project, which is a social network that empowers educators to create and share interactive educational content and to receive a revenue share when that content is used by learners. This project is showing steady growth. In February, user activity increased by 11% in terms of the number of active wallets and by a crazy 93% in transaction volume.
From all this information, several positive and negative signals can be identified for watchers regarding the evolving track of the Binance Smart Chain platform:
Positive Signals:
1. Adjustment of fees. Platform developers’ proactive adjustment of the fee structure to remain attractive to users and developers indicates a commitment to maintaining competitiveness and meeting user needs. This responsive approach demonstrates a willingness to adapt to market conditions and prioritize user satisfaction, potentially fostering increased trust and loyalty among platform participants.
2. Stable Daily Activity of wallets and transactions. Despite minor fluctuations, the daily activity of wallets on the platform remains at a high level as well as the transaction volume, indicating sustained user engagement and ongoing usage of dApps. This stability suggests that the platform continues to attract and retain a significant number of users over time.
3. Innovative Projects emergence. Projects like QnA3 and StarryNift demonstrate innovation and growth within the Binance Smart Chain ecosystem, providing users with unique and valuable services. These projects contribute to increasing user activity and transaction volume on the platform, enriching the overall user experience.
Negative Signals:
1. Increasing Transaction Costs. The average cost of transactions on the platform has been increasing, posing a challenge for end users who may prefer platforms with lower transaction costs. This trend could deter some users from engaging with dApps on Binance Smart Chain, particularly those seeking cost-effective solutions.
2. Decreasing Appeal Compared to Competitors. Binance Smart Chain faces challenges in maintaining its appeal as a platform with low transaction costs compared to competitors like Polygon and Solana. This may lead to a loss of users to other platforms offering more attractive fee structures, impacting user retention and engagement.
3. Potential Trend of Declining Demand. The stable level of daily active wallets and transaction volumes, alongside higher fees, may indicate a potential trend of declining demand for the platform’s services in the short term. If not addressed, this trend could negatively impact user activity and ecosystem growth over time.
In general, in terms of negative signals, we must say that BSC faces challenges in maintaining its appeal compared to competitors like Polygon and Solana, particularly in terms of transaction costs, and developers in the near future must resolve concerns related to this by exploring solutions to mitigate the impact on end users. The development track of the platform depends on this.
