Why Binance Coin Has Great Benefits

Binance, a very promising cryptocurrency exchange, was launched in 2017 and since then it conquered the cryptocurrency markets. Additionally, in less than a year it grew to a leading billion-dollar company in the crypto sphere. With the introduction of its native token called BNB coin, the cryptocurrency exchange is entering a new dimension into the markets.

Currently, every new initiative the exchange is launching seems to strike gold. Next in this article, I’ll give some deeper insight into why this young altcoin could be it and show you some benefits. Also, I want you to know that I wrote this article from my point of view and this shouldn’t be used as a piece of investment advice.

What is Binance Coin(BNB)

BNB coin can be best described as a native token which only exists on the Binance Exchange. As a result of being a native token, this BNB coin has multiple functions within the cryptocurrency exchange. The number of use cases is growing rapidly but the most important are:

• Fueling transactions on the chain
• Paying for transaction fees
• Buying IEO tokens with it
• BNB Staking in wallet
• Pay by credit card
• Pay travel expenses

Why Binance coin has so many uses cases? One of the main reasons is that it’s an ERC-20 token. As a result, this token is entirely compatible with the Ethereum Blockchain network and can be used as a smart contract.

Binance Coin in 2024

After the incredible start, Binance Coin (BNB) had in 2019, by increasing from $6 to almost $38 in just a few months, it currently is taking off steam. Also, at the start of 2024, BNB was priced on average at $15 per coin. Moreover, in just 1 month it managed to reach a new yearly high of $25 which is about 66% increase.

BNB currently sits within the top 10 cryptocurrencies by market cap and has a very high volume due to Binance pushing the use of their native token.

Why did this young altcoin rise so fast? It’s very hard to say but I think the main reason comes from the massive growth in volume the entire crypto exchange experienced. Back in 2017, right after the exchange was launched it gained a lot of popularity among bitcoin traders. As a result, it grew within 1 year to one of the largest cryptocurrency exchanges out there.

What is BNB coin exactly

BNB has a total supply of 200 Million coins and is a combination of two different token standards. Initially, BNB coin was launched as an ERC-20 token – meaning it runs on the Ethereum Blockchain – and is compatible with MyEtherWallet and all other ERC-20 Token wallets. Furthermore, in April 2019, Binance launched its new Mainnet which is an autonomous blockchain network including a new chain. Also, within this network BNB coin is available but it uses another token standard called BEP2 BNB tokens.

In summary, BNB is Binance’s native token which is currently BEP2 standard and performs many functions on the exchange and throughout the ecosystem.

What is it used for?

1. Trading

   On the Binance trading platform the BNB token can be used for trading and by doing this one has a discount of 25% on trading fees compared to BTC or USDT.

2. ICOS

   Binance have very cleverly (and recently) introduced their launchpad ICO platform where users can invest directly in vetted ICOs on Binance. Binance have changed the rules to a lottery based system where users will be randomly selected to participate in the ICO’s, but there’s a catch; they have to own BNB coin.

Binance Coin & Burning mechanism

Back in 2017, Binance initially created 200 Million BNB tokens. They plan to burn a total of 50% of the initial supply which is exactly 100 Million. This burning will be done once a quarter and depends on the amount of trading volume. The most recent burndown event happened back in July 2019, when $26 million in value was being burned. It’s important to know that these burning events are recorded on the Blockchain.

What are the Benefits of Binance Coin

Why Binance coin has so many benefits? I’ll try to explain in further detail here why this promising altcoin could be a rising star. Currently, it’s ranked within the top 10 on Coinmarketcap.com, but with so many developments and investor capital flowing in, it could be a real Ethereum competitor soon! Next, I’ll give you the main pros of this promising altcoin.

1. Trading fees

One of the main benefits of BNB is the discount traders can get when committing orders on the exchange itself. The actual default fee every trader gets is set to 0.1% per committed trade. This is by far the lowest fee I know compared to other cryptocurrency exchanges. Of course, there are always exceptions, but I only know exchanges who arrange ‘low fee scheduled periods’ with lower exchange rates. Binance has a default policy to set trading fees at 0.1% which is very cheap!

But there is more and that is why Binance coin was being introduced by its founder Changpeng Zhao. If you hold a balance of BNB coin then you automatically pay fees in BNB when trading. Why is this a benefit? Currently, BNB holders get a 25% discount over the default trading fee of 0.1% on every trade they make.

Fees continued at 25% & margin trading

Back in 2017, when BNB coin was being introduced the actual plan was to reduce the discount for BNB holders every year. As a matter of fact, the first year BNB holders got a discount of 50%! and was reduced to 25% in 2018. Currently, the discount remains at 25%, because recently Binance did an announcement that the 25% level will be continued this year.

Also, in June 2019, Binance made margin trading possible on its trading platform. From now on, more advanced traders can profit from the high trading volumes on Binance and take some extra risk with margin trading. Holding a balance in BNB gives you an extra benefit(50% discount) with trading fees at 0.01%.

Good to know

To maximize your trading profits on Binance, use this free link to sign up. It will give you an extra 10% discount for life. Besides, if you hold at least 1 BNB you get an additional discount of 25% on trading fees.

Is Binance Coin a good investment?

In my opinion, yes it definitely is. In the first place, BNB coin is the blood and veins of the entire Binance blockchain system and this platform is continuously improving and expanding over the entire globe. For example, Binance has launched several other exchanges besides the main Binance platform like Binance Jersey in Europe and Binance US in the USA.

In fact, Binance coin is a way to add liquidity and also a tool to trade cryptocurrency at a discount on their platform. Besides, Binance coin has a circulation supply of coins similar to Ethereum(currently about 145 million) what makes Binance coin a good investment with some upside to gain.

Bonus video: Why Binance Coin can reach $1000 in the years to come

2. Binance Launchpad

Next advantage Binance Coin brings is it’s extremely innovative platform called Binance Launchpad. It works like this: Investors can participate in ICO’s or Dapps on the platform. In contrast to other ICO programs launched in the past, Binance with its own token platform brings benefits. ICO projects launched earlier, had to deal with a lot of regulation like know your customer programs(KYC).

Why IEO Tokens

The advantage with Binance is that investors can participate anonymously but there is only 1 condition: investors have to own the BNB coin token. A big advantage for companies who start an IEO token at this platform is the potential reach to millions of investors who are trading at Binance daily. Also running your token on this platform gives the companies a head start compared to other blockchain projects existing in the market. The most important reason for this is that it’s very hard for these projects to get listed on Binance. Also, this trading platform is one of the biggest exchanges in the world and has a big market share in the total market.

In my opinion, Binance is handling business very smart by allowing companies to start ICO’s on their platform with the only condition to own the BNB token. With every new ICO that is launched on Binance, there is automatically demand in the BNB coin. This will drive the price of the BNB coin to the moon, which already happened in Q1 and will continue to grow further in 2019 and beyond.

3. Burndown rate of BNB

Another important reason why Binance coin has benefits is that Binance uses a burndown policy for their coin. Each quarter Binance will use 20% of their profits to buy back BNB altcoin. After buying back BNB they will burn these BNB altcoins so the total supply will be reduced.

They will continue doing this until 50% of the original supply has been burned and an amount of 100 million coins will be left. This deflationary policy will automatically result in rising prices for BNB over time just like the mother of all coins, Bitcoin, did in the past. So when the bull finally returns in the alt coins market, BNB altcoin will profit more because of the reason mentioned above.

4. BNB coin gains a lot of popularity

Last in the list, I want to mention the immense popularity Binance coin gained in the past few months among traders. Like I stated above, BNB coin has reached a steady place within top 10 on Coinmarketcap and has lots of potential to grow further. As a result, starting cryptocurrency exchanges, and even the bigger ones, have listed BNB alt coin(which is originally a native token) on their exchange. Good examples of cryptocurrency exchanges which have listed BNB coin are:

• Bancor
• IDEX
• Gate.io

Other big exchanges like Bitfinex, Kraken or Coinbase have followed the example of Binance by introducing their own native token. It makes sense to copy a successful strategy of a competitor, but I doubt if these exchanges will generate the same amount of trading volume as Binance did with their native Binance coin.

The following articles might also be a good read for you:

• What are the Benefits of Binance Trading Platform?
• 7 Most Trusted Crypto Exchanges(To trade Altcoins)
• What is the Best Way to Invest 1k in Crypto?
• Exclusive: Is Bitfinex Safe For Trading?
• Confidential: Best Places to Keep my Crypto Safe

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