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What is Binance Coin (BNB) ?
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May 12, 2022

What is Binance Coin (BNB) ?

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What is Binance Coin?

Binance Coin is a cryptocurrency issued by the Binance trading platform. Binance Coin runs on the Ethereum blockchain platform according to the ERC-20 standard. The BNB Coin has a limited supply of 200 million coins.

Binance Coin was born with the goal of promoting trading activities on the Binance platform and its full ecosystem. The purpose of using BNB in the Binance system is mainly to pay for trading fees, exchange fees, and other trading platform fees.

  • The ICO will receive 100 million BNB Tokens exclusively.
  • 80 million will be allocated to the founding team.
  • The final 20 million will go to investors.

What is BNB used for?

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  • Save on costs when trading

When using BNB to pay transaction fees on the Binance exchange, you will receive a significant discount compared to normal trading levels. Initially, BNB will be discounted by 50%, and then each year the discount will be halved. Up to now, the fee that is being applied is a 25% reduction.

  • Use it to withdraw cash

You can withdraw cash at ATMs. Currently, this form has not appeared in Vietnam.

  • How to have fun on social networks

BNB is currently exchanged for gifts or products on popular social networking sites such as Uplive, Adamant, Crypto Investfeed, and so on.

  • It can be stored in many wallets

The current BNB coin is highly appreciated on cryptocurrency exchanges today. We can mention wallets such as: Trezor, Ledger, Blox, Request,…

  • As a long-term investment strategy

Because BNB is a cryptocurrency with a limit of 200,000,000 coins. Due to the burning mechanism, BNB is currently only about 170,000,000 coins, which may continue to decrease in the coming years. This has made BNB more scarce than ever while the demand from investors is still increasing day by day. This is what causes Bitcoin to be beneficial, making it a long-term investment with long-term upside potential and long-term storage by investors.

Advantages and Disadvantages

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Advantages

  • Get a discount on transaction fees when using BNB to pay for transactions on the Binance exchange.
  • It is the coin of the world’s largest exchange, with a professional team.
  • High liquidity due to the increasing number of BNB users and transactions.
  • Independence and high security help ensure the safety of users as well as developers.

Disadvantages

  • Influenced by Binance: Since BNB is issued by the Binance cryptocurrency exchange, the development and growth of Binance will be directly influenced by the reputation of this exchange.
  • Affected by regulation: Since the legal framework for cryptocurrencies is still lacking in consistency and consistency across countries, when crypto policies are enacted, they can have a strong impact. to the price of BNB and all other coins.

Highlights of Binance Coin

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The Binance exchange and Binance Smart Chain are two highlights of Binance, marking a successful milestone when it has deployed a very large ecosystem. These two major platforms will lead the entire crypto market.

Binance Exchange

On Binance, users can conduct spot, margin, future, loan, stock, and P2P transactions. Saving, Pay, Binance NFT, and many more functions.

Binance Smart Chain

This is a decentralized exchange that allows 3rd parties to develop their own products on the network. Developers and users can easily migrate assets to use in BSC based on the very fact that they are built on Ethereum’s EVM.

The Binance exchange is really no less competitive when it was able to attract $25 billion of TVL, equivalent to more than 450 projects in many different fields.

  • ANM Liquidity: Ellipsis Finance, Bakeryswap
  • Lending: Alpaca Finance, Alpha Finance
  • Launchpad: Kichpad, Polkastarter, Pancakeswap
  • Yield Aggregator: PancakeBunny, Autofarm
  • NFT: Treasureland, Dego Finance,…

BNB Use Case

Binance Exchange

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Projects on the Binance exchange will be paid for listing fees in BNB coins. However, the amount of the specific listing will not be announced but will be donated entirely to the Binance Charity platform from October 8, 2018.

Exchange Fees: On the Binance exchange, BNB coins will be used to reduce transaction fees. The specific fee reductions are as follows:

In addition, Binance also applies a discount for VIP accounts to enjoy the appropriate preferential fees available in Binance’s trading services, including margin trading.

Binance Smart Chain

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This is considered as one of the biggest use cases that brought BNB a huge amount of growth. And that is the Binance Smart Chain ecosystem.

The similarity of BNB with ETH in the Ethereum network is that they are both used as a means of payment and are considered the main currency for the entire BSC ecosystem.

Used like Binance NFT Marketplace settlement coins, in the lending platform they are treated as collateral.

Binance DEX

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To avoid spam on Binance DEX, according to the listing proposal, if you want projects listed on Binance DEX, you need to send an additional 1000 BNB. But if the project is approved, 1000 BNB is like the deposit, which is returned to the project. Otherwise, the project will lose 1000 BNB.

As mentioned above, in order for the project to be listed on the Binance DEX, it is necessary to deposit an additional 1000 BNB.

Binance Launchpad

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Through Binance Launchpad, to have a high investment opportunity, investors need to hold BNB coin. If they have already made one investment in the project, they can only buy tokens with BNB coin.

Payments

BNB coin also has the effect of being used to pay at the store like a mainstream currency and is accepted by partners for payment in BNB coin.

Token BNB

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Name: BNB

Blockchain: Binance Chain

Consensus: Tendermint Mechanism

The Algorithm: Delegated Byzantine Fault Tolerance (dBFT)

Token type: native token type

Block time: 1 second.

Initial supply: an initial supply of 200,000,000 BNB

Total supply: total supply of 185,474,825 BNB

Circulating supply: circulation of 153,474,825 BNB

Coin burning mechanism

In order for any asset to rise in price, it would have to cause supply to decrease and demand to increase, making competition for that asset even rarer and more difficult.

Binance has set up a plan to burn BNB every quarter based on the volume of BNB redeemed after deducting 20% of the profit. This will continue until 50% of the total supply of BNB (equivalent to 100 million BNB) is burned. All these transactions are recorded on the blockchain and will circulate the remaining 100 million BNB at the end.

Project team

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This is one of the largest exchanges today, so it is not surprising that Binance Coin has been able to recruit a lot of potential developers despite its short time of establishment. They are important factors contributing to the success of BNB in particular, as well as the Binance ecosystem in general, not to mention the merits of CEO Changpeng Zhao.

This is the captain of a large ship called Binance. He has been with other sailors on the ship to research and launch the first coin under his own brand. Not only that, Binance also has a team of advisors who are legal and financial consultants with many years of experience.

They have a duty to be ready to solve any customer’s question, no matter how small. That further increases the prestige and strengthens Binance’s strong position in the market today, helping this already-noticed project attract even more investment.

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