BNB Chain’s revenue, in BNB terms, fell 11.7% QoQ. Network usage increased as average daily active addresses increased by 4.2% quarter on quarter.

The Binance ecosystem faced numerous difficulties in the first quarter of 2023. Whether it was the US Commodity Futures Trading Commission (CFTC) lawsuit or the increasing number of hacks on its BNB Chain, concerns about the future of one of the largest entities in the crypto space are rife.

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Amid this ongoing uncertainty, blockchain analytics firm Messari released a report on BNB Chain’s network performance in the first quarter and there were some notable developments.

State of BNB Chain in Q1 2023

One of the biggest takeaways was the 11.7% drop in revenue collected in Binance Coin [BNB]on a quarterly basis (QoQ).

In USD terms, sales decreased by 5.8%. The report emphasized that this was due to the drop in average transaction costs across the chain.

On the contrary, the circulating market capitalization increased by more than 24% quarter on quarter. The discrepancy between network value and revenue showed that value was driven more by overall market sentiment than by network utility.

Source: Messari

The improvement in BNB Chain’s financial situation may be related to the increase in network usage. While activity levels stabilized somewhat in the first quarter of 2023, BNB Chain’s average daily active addresses rose 4.2% quarter on quarter. Transaction activity followed a similar pattern as it ended the quarter growing nearly 4% quarter on quarter.

This meant that despite the ongoing FUD, BNB Chain’s user activity remained robust.

Source: Messari

How did BNB’s DeFi ecosystem perform?

With the start of the bullish rally, Q1 2023 saw a promising recovery of BNB Chain’s decentralized finance (DeFi) ecosystem. The USD-denominated Total Value Locked (TVL) grew by 10.2%.

In addition, the largest protocol in the chain, PancakeSwap[CAKE]was 3% higher quarter on quarter in terms of TVL.

DeFi on BNB Chain expanded beyond PancakeSwap with the launch of Uniswap [UNI] V3 in March. At the end of the first quarter, PancakeSwap’s TVL for BNB Chain was 43%, up from 46% in the previous quarter.

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Performance in the derivatives market

At the time of writing, the BNB token was valued at $325.66, down 4.56% in the past 24 hours, per CoinMarketCap. A look at BNB’s derivatives revealed that funding rates on most of the top exchanges were positive at the time of writing, reflecting the dominance of bullish long traders.

In addition, Coinglass data showed that demand for BNB futures contracts fell as Open Interest (OI) fell 3.84% over the past 24 hours.

Source: Coinglass

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