Binance Coin (BNB) registered a sharp drop of 7.8%, settling at $940 around November 4, 2025. The move coincided with massive market liquidations, estimated at $19 billion. Analysts attribute the decline to regulatory pressure on BNB, while, paradoxically, this situation drives privacy coins.
BNB’s drop below the $950 threshold is significant. The main trigger is the ongoing US Securities and Exchange Commission (SEC) lawsuit against Binance. This legal action has eroded trust in centralized exchange tokens. Furthermore, macro factors like a strong dollar and inflation worsened risk aversion. BNB’s capitalization, which stood between $130 and $138 billion before the pullback, felt the impact.
On the other hand, privacy coins are showing a unique rally. The sector posted an approximate return of 79.7% in the last month. Its total capitalization briefly exceeded $24 billion. Notable examples include Zcash (ZEC), which surged nearly 700% since September. Likewise, Dash (DASH) has appreciated over 70% in recent weeks, showing a clear divergence from BNB.
Is SEC scrutiny reshaping the crypto investment thesis?
This market divergence is key. The regulatory pressure on BNB drives privacy coins because investors are seeking anonymity. The demand for financial privacy is growing in response to supervision. Technical improvements also play a role, such as the increase in ZEC’s shielded supply (over 4.1 million) using zero-knowledge proofs. This movement suggests a capital rotation toward less traceable assets.
The fall of BNB directly affects the economy of the Binance ecosystem. It impacts indexed products, staking strategies, and liquidity for custodians. High volatility in exchange tokens can increase funding costs and margins for derivatives. For fund managers, this requires a review of BNB exposure and an adjustment in asset management (AUM) due to the new volatility.
The market is closely watching the evolution of the SEC lawsuit. This court case is the main milestone that could reshape risk perception of centralized tokens. Meanwhile, the regulatory pressure on BNB drives privacy coins as a clear trend. Compliance and product teams must adapt their risk controls to this reconfiguration of capital flows.
