Binance Coin (BNB) is a cryptocurrency released by Binance, one of the most popular exchanges in the world. It was created specifically to keep the site running and growing.
Contents:
- History
- ICO
- BNB Cryptocurrency
- Price and capitalization
- Binance Coin mining – options
- Where to store BNB: clarifying the BEP20, BEP2, and ERC20 networks
- Where to buy
- Conclusion
History
Binance was founded by a team of Chinese developers. According to them, there are several problems in the world of crypto exchanges that need to be solved. One of the biggest is the poor technical architecture of most crypto exchanges. They were indeed created by professional programmers, but without experience in developing and maintaining financial platforms.
More often than not, such developers choose the easiest way to make the system work. At the beginning all is well, but with the growth of traffic and the influx of customers, exchangers cannot cope, due to which there are failures up to the complete suspension of functioning.
Moreover, these exchanges often have security breaches, which can cause hackers to obtain traders’ cryptocurrencies.
Among other problems in this business, developers point to insufficient liquidity of trading platforms as well as problematic customer service. Therefore, a group of Chinese specialists decided to create an exchange that would eliminate all known shortcomings.
Along with the creation of the crypto marketplace itself, the Binance team decided to hold an ICO to raise money for the further development of their project.
Judging by the trading volume, the founders got what they wanted. According to Coinmarketcap, Binance is the world’s most popular exchange. Its daily trading volume is estimated at $11.1 billion, which is the largest in the world.
ICO
Binance launched its ICO in July 2017. It only took investors 3 minutes to buy up all the cryptocurrency on offer. According to the exchange itself, it managed to raise over $15 million in total. 200 million BNB were issued during the ICO.
Half of this amount “went” to the market. Another 40% was reserved for the team and the remaining 10% went to the first investors.
Of the money raised, 35% was spent on the technical development of the platform by Binance. Another 50% was spent by the exchange to promote its brand as well as training and promotion of blockchain technology. The remaining 15% went into a reserve fund, which was created to be used only in case of emergencies.
BNB cryptocurrency
The main purpose of BNB is to keep the exchange alive. For example, this cryptocurrency is used to pay commissions. In order to “train” crypto investors to pay commissions in BNB, the cryptocurrency exchange has created a rebate system.
Thus, in the first year of BNB’s existence, traders receive a 50% discount on commissions. In the second year, this bonus is reduced to 25%, in the third year to 12.5%, and in the fourth year to 6.75%. In the fifth year, the exchange plans to close the program.
The cryptocurrency exchange buys back cryptocurrency from investors every quarter in order to maintain the cryptocurrency’s value and protect it from inflation. The crypto platform allocates 20% of its profits for this purpose. The redeemed coins are then destroyed.
According to the crypto platform’s plan, there should be a total of no more than 100 million BNB in circulation.
Pricing and capitalization
After being added to the listing, the cryptocurrency was only worth $0.1. But the exchange rate went up from there. The price of BNB peaked on March 5, 2021. At that time, the cryptocurrency went up to $675. After that, due to a series of fluctuations, BNB fell to $222. Its capitalization stands at $36.4 bill.
Binance Coin mining – options
There is no mining of BNB, but there are several ways to get BNB.
First of all, the coin can be bought on Binance as well as on any other exchange. The coin is so popular that it can be bought on almost any exchange.
Secondly, BNB can be staked. You can draw an analogy with a bank deposit – coins are frozen for a certain period of time, for which, at the end of that period, you receive a predetermined percentage of the reward.
Third, you can participate in various promotions and programs from the Binance exchange. Often, the exchange carries out programs where a participant can receive a good reward. All one has to do is stick to certain conditions.
Where to store BNB: clarifying the BEP20, BEP2, and ERC20 networks
As the BNB token was originally developed on the Ethereum blockchain, it can be handled using wallets for the coin such as MyEtherWallet. An important clarification must be made though: the above wallet only supports the BSC blockchain (BEP20), which is based on the Ethereum blockchain ERC20.
The bnbwall.com web wallet is also a good solution for storing Binance coins on the BSC network. It is designed specifically for BNB (BEP20) transactions.
Why do we pay attention to the network supported by this or that wallet? Historically, there is another Binance Coin network – BEP2, which is not compatible with BEP20. For storing coins in the BEP2 network, Trust Wallet, and Guarda will be suitable.
To complete the picture, we should also mention the oldest BNB network, based on the ERC20 standard, i.e. the original Ethereum blockchain. This network is rarely used nowadays, but some wallets, such as Exodus, still support it.
Before you transfer your coins to someone, make sure that your wallets operate on the same network. Otherwise, the transaction may fail, or worse, the funds sent will be lost.
BNB can also be stored on the Binance exchange itself. If you want to transfer your BNB from one network to another, the exchange gives you the opportunity to do so.
Where to buy
Currently, the cryptocurrency has a daily trading volume of $1 billion, and all the trading is mostly done in one place – the Binance exchange. Most often investors exchange BNB for USDT and BUSD. The advantage of this crypto exchange is that you only need to register and verify your identity in order to trade. Right after that, you will be able to buy your desired coin amount.
You can also use any other exchange and exchanger which supports BNB.
Conclusion
Binance is an incredibly successful project. In less than a year of its existence, the exchange has managed to become the number 1 platform for buying and selling cryptocurrency. Moreover, the crypto exchange is not standing still and is constantly improving. Further growth of BNB cryptocurrency will depend on the success of its platform.
