Binance Coin Explained

Binance Coin doesn’t get the press of mainstream cryptocurrencies like Bitcoin and Ethereum, but that’s only because Binance Coin BNB isn’t meant to be a mainstream currency. Binance Coin is meant to be used on Binance coin exchange, where traders can get discounts through its use when buying any of the coins supported by Binance.

It’s pretty simple, and as Binance exchange has exploded in popularity, the Binance Coin price has had similar gains. Will this trend continue? Find out what we think in this Binance Coin review.

What is Binance Coin (BNB)?

As we’ve just stated, Binance Coin is a super simple idea.binance coin exchange

Binance is a cryptocurrency exchange like many others (Bittrex, Poloniex, Kraken, Huobi, etc.). All of these exchanges make money by charging traders for each trade they make. Binance is no exception. However, Binance offers a discount to traders who use their native token (Binance Coin BNB) as payment for trades (instead of Bitcoin, Ethereum, or USDT). Traders love a discount, so BNB is used by thousands every single day.

This strong use case is central to the way cryptocurrencies are trades. This means that BNB isn’t simply a trading token, but a valuable currency in its own right, tradable against all other major currencies. In fact, the case for BNB is so strong that BNB is one of only two cryptocurrencies that gained value during the 2018 Q1 Crash (along with VeChain). We think there’s good reason to think it will continue to rise. Here’s why.

Crytocurrency Traders Love Binance Exchange

Binance coin exhange is a huge hit. Since its genesis in Hong Kong in 2017, Binance has roared to its current place as world’s most popular cryptocurrency exchange. Binance has become something of a king-maker. When a coin like Ontology is added to Binance for the first time, this is seen as a major milestone, and the price of this coin always increases as a result.

Furthermore, Binance is distancing itself from the sometimes-worrying China, and all of the rumors associated with China’s “bans” on cryptocurrency (even though nothing seems to have ever come of these rumors). Binance is moving from Hong Kong to Malta, where local regulations are intensely favorable to fintech companies.

Here, Binance promises to start accepting fiat currency payments – a revolutionary service that allows anyone to buy cryptocurrency with ease. Currently, there are few cryptocurrency exchanges which accept fiat payments, of which Coinbase is easily the most recognizable.

Coinbase, however, sells only Bitcoin, Litecoin, Ethereum, and Bitcoin Cash. There are rumors that new coins will soon be introduced to the Coinbase family, but for now, those four are all that are offered. Meanwhile, Binance has literally dozens of cryptocurrencies. If all of those coins could be purchased with fiat payments (USD, EURO, etc.) this would be a major innovation in cryptocurrency, and Binance might really make itself the new center of the cryptocurrency galaxy.

There are even announcements that Binance is going to eventually morph itself into a decentralized exchange, which would further favor the trading and investment options for cryptocurrency speculators. We could go on and on, but suffice to say Binance is a popular any highly competitive exchange with nothing but sunshine on the horizon.

Cryptocurrency Traders Love Binance Coin BNB

Binance traders don’t just love the exchange; they love Binance Coin as well. As we’ve already stated, Binance coin can be used as payment on the Binance coin exchange. When traders use this option, they get a 50% discount on all trades.

This is significant because Binance trading fees are already as low as it gets. Bittrex is another trusted cryptocurrency exchange, and their trading fees for buying and selling are a reasonable 0.25%. Binance’s standard trading fees are less than half of that at 0.10%, and using BNB cuts that and half to an as-low-as-it-gets 0.05%!

If that weren’t enough to make you love Binance coin BNB, the smart people at Binance also built some interesting features to make BNB an interesting investment for all, not just for people who use it to make trades. The Binance Coin supply is currently about 116,000,000 BNB. Once a quarter (four times per year), Binance exchange uses 20% of its profits to Buy Back BNB. What happens then? They BURN it!

That’s right folks, the BNB Binance buys back from the general market is nuked. Destroyed. Rendered nonexistent. Ripped from the material plane. This makes some simple changes to the supply and demand that exist for Binance Coin BNB. Now that the supply is lower, the price of each BNB goes up. This process also attracts new investors to Binance Coin who want to own a deflationary, highly-useful coin.

All of these factors have driven Binance Coin BNB into the creyptocurrency top 20. As Binance exchange continues to innovate, we think it could soon hit the top 10. The Binance quarterly burn is about to happen, so bear that in mind when considering whether or not to buy Binance coin.

If you want to know how to buy Binance coin, check out our complete How to Buy Binance Coin Review.

The Team Behind Binance Coin

Unlike so many other cryptocurrency development teams, the Binance Coin team is already in charge of a thriving platform: Binance itself! Here are the key figures of Binance’s ongoing success.

You can dig into the full team bios on your own time. For now, we’ll acquaint you with Changpeng Zhao, founder and CEP of Binance exchange. Zhao worked on Tradebook Futures Development at Bloomberg all the way back in 2001. Since then, he’s been a long term partner at Fusion Systems, the business IT company. He entered the blockchain space as head of development at Blockchain. He then founded BijieTech, an exchanges systems provider, and finally used all of this experience in founding Binance in 2017.

Zhao has an eye for talent, and has stacked the Binance bench with other qualified professionals with experience in all aspects of fintech and blockchain technology.

Are There Any Downsides to Investing in Binance Coin?

Obviously, this Binance Coin review has been a rave so far, but are there any reasons to be suspicious of Binance Coin? An investor can never be too cautious, but we honestly have to scrape to find reasons not to invest in Binance Coin. In an effort to be fair an balanced, here are those.

  • Binance Coin has a high RSI. RSI is a measure of investment returns across short periods of time. When an asset’s RSI is high, it is likely to be “overbought”, or simply too expensive. These rules often don’t apply in cryptoworld, which has added more than a million users in a day before. But some people think this is a significant consideration, given the current Binance Coin price.
  • Binance may not always be the most popular cryptocurrency exchange. Binance is a tech unicorn right now, having sprung to a billion dollar valuation faster than any other company in history. And as far as prices, features, and security go, Binance pretty much wipes up the competition. There are, however, exchanges which are trying to steal its thunder. Bittrex wants to add fiat pairs in 2018.Numerous decentralized exchange options like ShapeShift, 0X, and DEX are making it possible to buy and sell crypto without an exchange like Binance. However, other decentralized exchange protocols like Loopring are merely incorporating Binance’s infrastructure. Binance is still the big dog in this realm, and even though there are new players, we see no reason why they’re going to take the Binance crown anytime soon.

As you can see, Binance is in a pretty strong position as a cryptocurrency exchange. This means that Binance coin is likely to hold and exceed its current value in the coming days. This could always change, and you should do your own research before you buy, but if you can think of a good reason why Binance coin isn’t a great buy, please do let us know.

Final Thoughts on Binance Coin

Binance Coin BNB is one of the few cryptocurrencies that has a strong use case right out of the gate, widespread adoption, and path for future domination. With a deflationary supply and a parent platform that’s only expanding its global reach, we think Binance Coin BNB is a definite buy for 2018.

Summary
Binance Coin Explained
Article Name
Binance Coin Explained
Description
Binance is a cryptocurrency exchange like many others (Bittrex, Poloniex, Kraken, Huobi, etc.). All of these exchanges make money by charging traders for each trade they make.
Publisher Name
Coinlist.me

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