Binance Coin- Empowering the Future of Crypto Trading

Binance Coin: BNB
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BNB is an acronym for Binance Coin, powering the Binance Chain ecosystem. BNB is one of the most popular utility tokens used for trading like any other cryptocurrency and in multiple applications and use cases. 

Heads-up about BNB Coin

Binance Coin began as an Ethereum Request for Comment (ERC)-20 token built on the Ethereum blockchain. BNB coin was initiated through an Initial Coin Offering (ICO) in 2017, with a net supply of 200 million coins. BNB gave its early investors a whopping 1,300% return within a year. Binance Coin’s popularity rose quickly thanks to its blazing performance, making it a favourite in the crypto market. Binance was initially launched as the Binance Smart Chain (BSC) and is now addressed as BNB Smart Chain. 

Understanding Binance Coin

BNB coin is expected to boost operations of the Binance exchange and its ecosystem by supporting multiple utilities like listing fees, exchange fees, trading fees, and other associated fees on the Binance exchange. BNB coins have gathered support from numerous partnerships that have helped spread usage. Here are a few things you should consider before you buy:

  1. Through Binance’s Launchpad programme, BNB coins can be used to buy in different Initial Coin Offerings (ICO). 
  2. BNB is moving smoothly in the direction of being the main currency for decentralised trade.
  3. When new virtual currencies are added to the Binance exchange, BNB coins will make it easy to buy and sell them on a single market.

Use Cases

The utility for BNB coins has constantly increased with the expanding BNB Chain. The coin’s use cases are:

  1. Trade NFTs
  2. Play Crypto games
  3. Lend on DeFi protocols
  4. Exchange on DEXs
  5. Pay transaction fees: Apart from paying transaction fees on the BNB exchange, the investors also receive a discount. 
  6. Stake to earn rewards
  7. Participate in token sales

Apart from the uses mentioned above in the BNB ecosystem, BNB coins can be used for a range of real-world benefits by traders, like

  • Travel: Certain websites accept BNB coins as a mode of payment for hotel and flight bookings. 
  • Credit card payments: Crypto card bills can be paid using BNB coins.
  • Buying Virtual Assets: Many platforms allow BNB to be used as collateral security for loans. A few applications allow friends and family to split bills and pay each other through BNB coin. 
  • Investments: Various platforms enable stock and ETF investments using Binance.  

Recently, Binance has partnered with VISA for a Binance crypto card that will work like a debit card. Meaning you will have to fund the card to make payments. With multiple use cases, it is entirely up to the trader to decide how they would like to use the BNB coin in the Binance ecosystem. On the Binance trading platform, roughly two million users use BNB to pay trading fees. 

How does Binance Coin Work?

Transactions on the BNB Chain’s two alternative blockchains, the BNB Beacon Chain and the Binance Smart Chain (BSC), are powered by BNB coins. Binance’s first blockchain, BNB Beacon Chain, is all about staking and control for BNB holders. On the other hand, BSC is an Ethereum virtual machine (EVM), which is a suitable blockchain that can be used instead of the Ethereum network and makes it easier to make smart contracts.

Heard of PoSA or Proof of stake authority? Yes, BNB Chain uses this unique consensus to govern its network and validate transactions. The system combines delegated proof of stake (DPoS) and proof of power (PoA) consensus algorithms. 

Binance runs a programme called the BNB Pioneer Burn Programme, which is like a buy-back programme, to stop the value of its coins from going down. Here, Binance buys a quarter’s worth of back-token goods and burns BNB. This reduces the amount of tokens that are in circulation and keeps the price stable. Binance wants to get rid of half of the 200 million BNB tokens that are in circulation. This is expected to take 27 years. In October 2022, the last quarterly BNB burning event took place, and 2,065,152 BNB tokens, worth $547 million, were burned. 

Binance Coin Burn

Initially, 100 million Binance tokens were offered in the ICO, but the current total supply is much lower. Binance uses one-fifth of its profits each quarter, repurchases the coins in circulation, and permanently destroys or “burns” them. Binance coins are held in its treasury.

Binance regularly performs these burning events. The last BNB burn occurred on April 15, 2021, when Binance burned a whooping 1,099,888 BNB, equal to USD 595,314,380 worth of tokens. It is the most extensive BNB burn in USD and the 15th BNB burn, bringing down the supply of BNB tokens from 170,532,825 to 169,432,937. 

Binance shall continue burning BNB coins quarterly until it has repurchased and destroyed 100 million coins, half its original maximum supply. The burning process decreases the BNB Coin’s supply, creating rarity and affecting the asset’s value. 

BNB pricing and dynamics

Like all other crypto assets, BNB has also been on the receiving end of significant price fluctuations. Binance Coin’s market cap has grown exponentially over the years, crossing a valuation of $70 billion. When the BNB coin was launched through ICO, it was sold for about $0.10 per token. Since being afloat, BNB has significantly grown in value, with a price tag of more than $314 per coin. 

Is Binance Coin a good investment? 

The historical price rise has yielded profits for its buyers who entered and sold at the correct times. Since volatility is the other name for crypto assets, no one can predict the price structure. However, with multiple use cases, adaptability, and burning programs, BNB will live up to the trader’s expectations and prove beneficial in the future. Click here to learn more about the Bluechip Cryptos.

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