Binance Coin referred to as BNB, is the native currency of the Binance exchange, initially created on the Ethereum blockchain using the stock ERC20, which was later migrated to its own blockchain. Binance will issue a maximum of 200 million BNB tokens. Its main goal is to enhance the exchange’s operations by providing convenience and accessibility to investors and cryptocurrency enthusiasts. Currently, the coin is trading around $ 580.
The coin was launched in July 2017, through an Initial Coin Offering (ICO) that put 20 million BNB tokens into play for investors, 80 million for project contributors, and the remaining 100 million for the various people who have participated in the ICO. Funds raised through the sale of BNB tokens were used for trade development, branding, and other marketing projects. A percentage of the stake was also spent on adding the necessary updates to the Binance crypto exchange.
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Why Was Binance Coin Created?
Binance Coin has been created to power the cryptocurrency exchange platform and powers its operations to establish a sustainable ecosystem. Currency can be used for a multitude of purposes, including paying the exchange fee, trading fee, or any other charges a user might incur on the exchange. In the first year, Binance offered a 50% discount that would be halved every subsequent year with a discount that would end in the fifth year.
The coin can also be used for IEO investments listed in the Binance Launchpad section. These new coins will be listed on the Binance exchange, providing them with a comprehensive market for trading, which can also be developed on platforms such as the Bitcoin Code. Having a native currency will reduce reliance on traditional money which, in addition to causing delays, involves an additional financial burden for the end-user. This token offers a seamless experience allowing users to save money on operations.
How Does Binance Coin Work And What technology Is Behind It?
Binance Coin is built on the Binance blockchain and uses BEP2 tokens that can store and hold value. However, tokens cannot be mined because they have already been mined and distributed via the ICO. The tokens in circulation are used for trading on the Binance exchange. The discount rate started at 50% in the first year but is expected to halve every year.
For the fifth year, there will be no discounts that will affect the value of the token. To counter the depreciation in value, Binance bought tokens and destroyed them to reduce the supply. The cryptocurrency exchange plans to remove half of the tokens in circulation.
Is Binance Coin Real Money?
BNB’s main goal is to increase the operations of the Binance ecosystem. Currently, the token can also be used to obtain discounts on the platform. However, the promotion will no longer be available in the next few years. Binance Coin can be used to pay for travel services and hospitality.
Binance has great financial and strategic support, which can keep the token afloat for years to come. This means that the outlook for dominant altcoins may change in the coming years. It won’t be a good idea to bet against a token backed by an exchange that handles billions of dollars worth of crypto transactions every month.
How secure is the Binance Coin network?
Binance Coin uses its own Binance Chain blockchain, which uses cryptography to prevent data breaches and an interception. Since the blockchain is decentralized, there is no central entity that can be hacked to compromise the data. Additionally, cryptocurrency exchange Binance is a trusted name in the crypto space for the layered security features they add to keep your personal information and funds safe. These include two-factor authentication and SSL certificate encryption. You can also use wallets to keep your BNBs safe.
Is it worth investing in Binance Coin?
Binance Coin is currently trading around $ 580. One of the most promising things about BNB tokens is that their success doesn’t depend on becoming a viable monetary alternative. The practical use of the coin is within the Binance ecosystem to drive digital asset trading and operations, providing a seamless experience for platform users. It is one of those currencies that have an inherent use.
That said, the cryptocurrency space can be quite unpredictable, especially when it comes to price fluctuations. If you are looking to invest in BNB or any other cryptocurrency, do so with caution to make sure your investment capital remains safe.