What is Binance Coin?
Binance coin is a digital currency issued by the cryptocurrency exchange Binance. The cryptocurrency is denoted by the symbol BNB. It is based on the Ethereum blockchain and similar to Ether, the BNB token also fuels all operations on Binance.com.
Binance coin is used by users to pay the fees levied by Binance exchange for using the services. These fees include, but are not limited to trading fees, exchange fees, and listing fees. Additionally, Like any other cryptocurrency, BNB can also be traded on supported cryptocurrency exchanges.
Background & Team
Binance is a Chinese company, originally started in Shanghai and now based in Malta. Its founder, Changpeng Zhao, is the former CTO of OKCoin, another prominent Chinese cryptocurrency exchange. Zhao’s company, Beiji Technology, owns and operates Binance.
In August 2017, shortly after launch, Binance announced that Yi He would join the team. Yi He was one of the original co-founders of OKCoin. She’s widely recognized for her ability to grow technology products and gain user adoption. Zhao, He, and the Binance team have grown the company into one of the biggest exchanges in the world in a fairly short period.
BNB was launched through an Initial Coin Offering (ICO) on 14th July 2017 as an ERC-20 token before the Exchange was launched. A total of 15 Million USD dollars were raised during the event. Investors were compensated with BNB tokens during the ICO.
At the time, each token was exchanging hands at US$0.10. The token’s price has since tremendously appreciated and is now one of the top 10 cryptocurrencies with the highest market capitalisation according to CoinMarketCap. The token initially ran on the Ethereum network but was later swapped 1:1 with BEP2 BNB tokens. This is so the tokens can instead run on their own Binance Chain.
Uses for BNB on Binance Exchange
- Exchange Fees: Binance tokens can be used to reduce trading fees. Currently, Binance has a 0.1% trade fee and 50% of this fee can be paid in BNB. You are eligible for a 25% discount when paying for trading fees using the token.
- GAS: Binance will eventually feature advanced features that require GAS. The tokens can be used as GAS to power these advanced features.
- Binance Launchpad: BNB is used to participating in the Binance Launchpad. This is an Initial Exchange Offering platform where cryptocurrency projects will publicly issue tokens on the exchange to participants.
- Binance DEX: The Binance DEX (Decentralised Exchange) runs on the Exchange’s Binance Chain.
- Staking: Binance eventually wants to develop a decentralised exchange. The tokens will be used on the Exchange to stake transactions.
Other uses for BNB
BNB can be used in other areas. For example:
- Paying for goods and services: The token can also be used to pay for goods and services at different establishments. For instance, Binance invested in TravelbyBit to enable users to pay for services at entire Brisbane Airport. TravelbyBit is an Australian startup that enables establishments to accept cryptocurrencies for goods or services. Currently, the startup has over 150 establishments.
- Accessing loans and cash: Holders of the Binance exchange token can withdraw cash from crypto ATMs. Additionally, they can access loans on the Nexo platform.
- Accessing services on social media platforms: For example, it can act as a gift token on Uplive, a live streaming platform.
- Trading and holding: The token can be traded just as a normal altcoin. Additionally, some people hold and speculate on the token in the hopes of profiting when the price appreciates.
BNB Token Storage
Similar to other cryptocurrency exchanges, Binance also provides a wallet which can be used for storing BNB or any other cryptocurrency that trades on Binance exchange. In July 2018, Binance acquired Trust Wallet, a mobile wallet for Ethereum-based tokens. Trust Wallet is now being marketed as the official Binance wallet. Apart from the official wallet, BNB can be stored on an Ethereum compatible wallet. Some popular options are:
- Ledger Nano S
How is Binance Coin different from other cryptocurrencies?
- Unlike Bitcoin. Binance Coin’s functionality is not limit to only peer-to-peer payments. It is an integral part of the Binance’s ecosystem. BNB token is essentially a means for collecting revenue for the platform.
- BNB token has some unique benefits for its use on the platform. By using BNB users can be entitled to extra discount rates that are not otherwise applicable with any other cryptocurrency.
- In addition to a cryptocurrency exchange, Binance also features a platform Binance Labs for investing and incubating blockchain projects. As mentioned on the Binance website- “Binance Labs is a social impact fund and an initiative to incubate, invest, and empower blockchain and cryptocurrency entrepreneurs, projects, and communities.”
Long-term Binance Coin price prediction: 2020 – 2024
The Binance Coin price prediction can be made on the basis of the above factors. The degree to which the individual points are weighted and influence the assessment varies greatly. For this reason, the following provides an overview of the forecasts of various forecast websites for the next 5 years for BNB:
- Coinswitch: The price is expected to rise to US$ 49.85 in 2020. This assessment is based on the forthcoming partnerships with two projects in Brazil and the planned partnership with Moeda. As a result, Binance could rise to 5th place among crypto currencies in terms of market capitalization. This would also have a positive impact on the value of the coin. In 5 years the Binance Coin could finally rise to US$ 89.7.
- WalletInvestor: This platform uses historical data and technical analyses for its Binance Coin forecast. They come to the conclusion that the price for BNB will rise by around 23% within a year. The price is expected to rise continuously in the coming years. In 5 years, i.e. 2024, 1 BNB would cost about US$ 64.46.
- U.today: For the short-term Binance Coin forecast, the platform is based on the current situation and the factors mentioned above. They conclude that the BNB will trade at an average of US$25 until the end of 2019. The price could continue to rise in the coming years, with the result that the Binance Coin forecast will be around US$ 52 by the end of 2023.
Source : boxmining, coinswitch, coincentral
Photo Credit : Hacker Noon.
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