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In summary
- BNB hit an all-time high of $788, driven by a general rally in the Cryptocurrency market.
- Ethereum Classic and Bitcoin SV also rose, posting weekly gains of 21% and 20%, respectively.
- Analysts warn that the boom in old tokens could be speculative and not sustainable in the long term.
Binance’s native token (BNB) jumped to all-time highs on Wednesday amid a broader cryptocurrency market rally that saw a resurgence in long-standing altcoins affiliated with Ethereum and Bitcoin.
BNB rose 8% to a new peak above $788, surpassing its previous June all-time high of $710, according to data from CoinGecko. The asset is used for discounts on trading fees, transaction fees on the Binance Smart Chain, staking, participation in token sales, payments, loans and loans.
Meanwhile, Ethereum Classic (ETC) and Bitcoin SV (BSV) continue to rise, reaching heights not seen since March and April, respectively. ETC is up 21% on the week to $38.37, while SBV is posting similar gains, up 20% to $82.80.
Bitcoin Cash (BCH) has also risen in the last seven days, rising 12% to $583.
The tokens originated from hard forks of Bitcoin and Ethereum, stemming from disagreements over the direction and philosophy of the project, which led to the creation of separate networks with different protocols.
Ideological divisions included issues of scalability, transaction costs, and governance, resulting in the fragmentation of communities.
So what happens?
According to Ryan McMillin, chief investment officer at Merkle Tree Capital, the recent rally in a number of older tokens more closely resembles the price action of memecoins.
“It’s not too surprising, as these tokens already have a presence in the minds of investors from previous cycles and benefit from being listed on major exchanges, providing easy access for retail investors,” McMillin told Decrypt.
However, McMillin cautioned that experienced cryptocurrency investors are unlikely to “chase the rally” despite the recent momentum seen over the past 30 days.
“I expect these tokens to revert to the mean over time as capital moves to projects with stronger fundamentals and active ecosystems,” he said. “It’s more likely to be used as exit liquidity than to catch another rally.”
In other words, prices will likely move back closer to historical averages once the speculative pump fades, Mcmillin said.
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