Binance Coin (BNB) is the Binance platform’s native cryptocurrency. Originally BNB was designed to serve an alternate means for traders to pay their fees on the Binance exchange. More recently the Binance Chain has evolved with a decentralised exchange that sits on the blockchain.
What is Binance Coin?
Binance Coin was originally launched as an ERC-20 on the Ethereum blockchain. Since then BNB has migrated to the Binance Chain, which is Binance own proprietary blockchain. Binance is the world’s largest cryptocurrency trading exchange by volume. Over a hundred cryptocurrencies trade through the exchange.
The company was founded in 2017 by CEO Changpeng Zhao. Zhao has extensive experience in the cryptocurrency world. He was the third member of the Blockchain.info team and served as the CTO for OKCoin. Binance was originally based in Shanghai but later moved to Japan after a ban by the government. Binance was forced to move again in March 2018, after the JFSA (Japanese Financial Service Authority) ordered the exchange to shut down. Binance will now have its headquarters in the more cryptocurrency friendly Malta.
The original purpose of Binance Coin was a means for traders to pay for their fees on the exchange. Binance charges both a trading fee and a withdrawal fee. When fees are paid using BNB traders receive a discount. This discount is on a sliding scale; on the first year they receive a 50% discount through to a 6.75% discount in the fourth year.
The consequence of this sliding scale in the discount rate means that Binance Coin can be expected to decrease in value over time. In order to counteract this fall in value Binance Coin has an inbuilt burn. Every quarter a set amount of Binance Coin will be destroyed based on the total trading volume of the Binance platform. In principle this burn should stabilise Binance Coin over time.
Binance Coin was originally launched in 2017 with an offering of 100 million BNB coins. These coins were all minted before the start of the ICO. The entire supply of coins was sold within twenty days. In the process $15 million was raised. The funds raised by the ICO were used to build out the Binance platform and to upgrade the systems. The remainder of the funds were used primarily for marketing and branding activities.
The final supply of Binance Coins has been capped at two hundred million tokens. The founders of Binance Coin were allocated an additional eighty million coins and angel investors received twenty million coins. As noted, Binance Coins will be burned over time.
Where to buy Binance Coin
Why buy Binance Coin
The success of Binance coin is tied to that of the Binance exchange. Binance is already the world’s biggest cryptocurrency exchange by volume. If it can continue to hold this position as a market leader, then it seems like that Binance coin will likewise perform well.
One unique advantage that Binance coin has over other cryptocurrencies is the discount that is offered for trading fees on the Binance platform. The value for traders in using Binance coin to pay fees is significant. Given the huge amount of trade volume that the Binance platform does, there is almost certainly going to be continued demand for the digital token.
How to sell Binance Coin
- Open an account with one the cryptocurrency exchanges listed above
- Transfer your Binance coin to the cryptocurrency exchange
- Exchange your Binance coin for Bitcoin
- Send your Bitcoin to a platform that allows you to exchange it for fiat currency
- Transfer your fiat currency to your bank account