In the cryptocurrency market, exchanges are a necessity. They firstly act as the gateway for people to enter the cryptocurrency market and also acts as the place where other coins are bought, sold and stored. The cryptocurrency market has many exchanges. Users and traders of the cryptocurrency market are spoilt for choice because of a large number of options available.

Currently, there are 224 exchanges listed on coinmarketcap. All offering different services and selling different coins and tokens. Most of the good exchanges offer low transaction fees and high security. But the exchange that stands out amongst all of the ones listed is Binance.

Binance is currently the number one cryptocurrency exchange based on market capitalisation and trade volume. The exchange is most well known for having slashed transaction fees across the industry at a time when they were rampant and high. The exchange, over the last two years of its existence, has been alternating between 1st and 2nd place, until recently it settled down at number 1.

Binance; the Exchange

This is because the Binance exchange and platform took the community and market by storm when it was released and initially launched. Binance was founded in 2017 by Changpeng Zhao and Yi He. Changpeng Zhao continues to be a key person in Binance’s day-to-day while Yi He has taken a more hands-off approach.  

Binance came at a time when the cryptocurrency market and its users were facing a huge problem because of the fraying of the network. Transaction fees were insanely high and everyone was looking for a cheaper alternative to the already existing options and postponing trades for a time when they were low.

Binance, as a part of its launch, slashed transaction fees completely as a part of their introductory offer. The campaign came as a stroke of good luck for the exchange because it changed the way the community worked and attracted truckloads of users to the exchange.

Since its release, Binance has been alternating between the first and second position of exchanges in the market in terms of capitalisation, volume and user base. But over the last year, the exchange has asserted itself as the best and number one exchange of the global cryptocurrency community. The exchange has many interesting features like for example Binance is one of the most secure exchanges in the market right now. It has never been hacked and the one time it was breached was because of an API malfunction. The Binance exchange also provides users with a wallet service, which is very heavily subscribed to.

Binance also has a native token. The token was used as a part of their original ICO and has continued as a coin that is listed on their market. The native coin is called Binance Coin (BNB), it is and can be used to redeem and lower trading fees on the platform. In this article we will explore the features of the coin, it’s used on the network and why it is an investment that all cryptocurrency enthusiasts should consider.

Binance; The Coin

The native token of the Binance exchange is called the Binance Coin (BNB). The Binance Coin or the BNB runs natively on the Ethereum Blockchain and is a token/coin that adheres to ERC20 Standards of the Ethereum Network. The symbol of the Binance Coin is BNB. The Binance Coin token is the same coin that was used in the Binance ICO.

The token has a fixed supply set at 200 million coins. But 100 million of those coins are already planned for by the Binance platform. Binance aims to buy back BNB with 20% of its profit every quarter and burn the coin. Binance conducts coin burns every quarter. A coin burn is a process in which the coin is bought back and destroyed in the intention of controlling coin inflation and/or reducing the total supply of the coin.

The reason token creators and holders benefit out of coin burns is because when the coin has a limited and low supply and thereby circulation, it increases the value of the coin inherently. A commodity which has high demand and low supply is a more valuable one. To that effect, the Binance Coin will be burned until half of its supply is diminished, that is 100 million BNB’s are destroyed over quarters.

The Binance coin, apart from being a coin that people bought to fund Binance’s development, is also a utility token. The Binance coin has many functions on the Binance platform and they are:

• Lowered trading fees, up to 50% discount
• Is recognised on the Monaco platform
• Can be used as a payment method on some platforms

One of the biggest challenges that the Binance platform and thereby the token faces are the high rates of demand and its diminishing supply. The Binance exchange has a user base of more than 9 million traders worldwide. The exchange also has 386 live markets and coins listed on it. And because of the utilities of the token, everyone is looking for a way to get their hands on the Binance Coin.

Another reason that the Binance Coin is doing so well as an idea and now more and more as a product, is because the platform also offers the Binance coin for token for offer services. The most well-known companies that are currently using the BNB token as a offering service are; Pundi X and NEXO.

Pundi X has added BNB to its POS. Which basically means that the user can use BNB tokens and coin on the Pundi X platform to buy things and services. The Binance exchange had also partnered with Pundi X for their token unlock program.

The Binance Coin

The Binance Coin is the Binance exchange’s native coin. It is the same coin that was used in the Binance ICO. The coin started off as just that but matured into becoming a utility token on the exchange. Using which cryptocurrency users could redeem their trading fees and further bring down operation costs on the exchange.

The Binance coin runs natively on the Ethereum Blockchain and adheres to ERC20 Standard of the Ethereum Network. The coin has a total supply of 200 million and over the years, 100 million of those coins are already spoken for. The exchange will buy back BNB’s from users using 20% of its quarterly profits and conduct coin burns.

The Binance Coin, on coinmarketcap, is ranked as the 14th largest cryptocurrency in the market in terms of the market capitalisation metric. The all-time high of the cryptocurrency is around $24.46 USD. The current price of the coin is $9.77 USD.

To buy; Binance, LBanks, Exrates.  

Must Read How Safe is Binance Exchange

Hitesh Malviya

Hitesh Malviya is the Founder of ItsBlockchain. He is one of the most early adopters of blockchain & cryptocurrency enthusiast in India. After being into space for a few years, he started IBC in 2016 to help other early adopters learn about the technology.
Before IBC, Hitesh has founded 4 companies in the cyber security & IT space.