NOIDA (CoinChapter.com)—BGB, the crypto exchange Bitget’s native token, has surged to a new all-time high following recent updates. The token’s rally helped attract investor attention, propelling it to the list of trending tokens. Trading at new highs, the token’s rally stems from a combination of strategic moves by the Bitget exchange, including ecosystem consolidation, deflationary measures, and increasing adoption.
Although the token dropped over 15% on Dec. 28, likely due to profit booking, BGB price’s bull run in Dec. 2024 helped net holders gain 434% as the token reached $8.5 on Dec. 27.
BGBUSDT daily price chart with RSI. Source: TradingviewDespite the dip, the Bitget token’s relative strength index remained overbought, with a score of 82.79 on the daily charts. The overbought RSI levels might force the token to correct, testing the waters at the support near $6.4. If bulls fail to defend this support, the token could drop to the support level near $4.4 before recovering.
On the other hand, a continued rally would likely see BGB price face resistance near $9.7 and $12, resistance levels coinciding with 0.618 and 0.786 Fib retracement levels.
Here’s a closer look at the drivers behind the price movement.
1. BWB-BGB Merger: Unifying the Ecosystem
Bitget announced a merger of its two tokens, Bitget Wallet Token (BWB) and Bitget Token (BGB), as part of its efforts to streamline tokenomics and enhance BGB’s role within its ecosystem. The move allowed BWB holders to convert their tokens into BGB at a predetermined ratio of 0.08563 BGB per BWB, calculated using a seven-day average closing price.
Once the swap concluded, all remaining BWB tokens were permanently burned. This burn reduced the overall supply and consolidated the token’s utility, making BGB the central asset for both Bitget’s centralized and decentralized platforms. By simplifying its token model, Bitget aimed to attract new users and ensure existing users could engage with its ecosystem more efficiently.
Bitget announced the merger of its BGB and BWB tokens.The merger also clarified BGB’s purpose, positioning it as the singular utility token within the ecosystem. It supports trading fee discounts, staking, and integration with decentralized applications. The unified approach appears to have increased investors’ confidence and driven the token’s demand.
Moreover, the elimination of BWB and the enhanced focus on BGB have contributed significantly to the recent rally, as the market recognized the strategic benefits of a consolidated token economy.
2. Token Burn: Implementing a Deflationary Model
A major contributor to BGB’s recent rally is Bitget’s large-scale token burn initiative. The exchange revealed plans to burn 800 million BGB tokens, equivalent to 40% of the total supply, with a market value exceeding $5 billion. The measure is part of Bitget’s broader strategy to reduce circulating supply and create deflationary pressure on the token.
Bitget plans to implement quarterly burns in 2025.Deflationary tokenomics aim to enhance scarcity, often resulting in upward price momentum as demand grows against a limited supply. To implement this model, Bitget intends to conduct quarterly token burns starting in 2025. The platform plans to allocate 20% of its exchange and wallet operations profits to buy back and burn additional BGB tokens.
These measures stabilize long-term value, especially as BGB’s role within the ecosystem expands. The announcement of such a significant burn initiative has likely attracted speculative interest and contributed to the token’s rally. Furthermore, the immediate reduction of supply following the BWB merger has magnified the effect of these deflationary measures.
3. Expanding Utility and Market Presence
The rising demand for BGB is linked to structural changes and expanding utility within Bitget’s ecosystem and beyond. The token has been integrated into decentralized applications (DApps) and is a core asset within various blockchain ecosystems. Its use cases include staking in lending protocols, paying gas fees in cross-chain transactions, and powering services within the Bitget Wallet.
Additionally, Bitget has outlined plans to extend BGB’s use to real-world scenarios starting in 2025. Users can use the token to pay for dining, travel, shopping, and other everyday activities. This initiative positions BGB as a bridge between blockchain technology and traditional financial systems, potentially increasing its appeal among non-crypto users.
The exchange’s expansion into new markets has also bolstered its user base, leading to a corresponding increase in demand for BGB. These combined factors—growing adoption, integration into financial ecosystems, and broader market presence—have likely contributed to BGB’s recent price gains.
