Whether a novice or a seasoned investor, everyone who has entered the cryptocurrency market has heard of Binance, a name derived from the fusion of Bitcoin and Finance. Even if you have not used Binance, you are likely familiar with Binance Coin (BNB). Currently, Binance Coin ranks third in the cryptocurrency market, trailing only Ethereum and Bitcoin.
Binance Coin has ascended to second place among altcoins and is widely regarded as a robust cryptocurrency with substantial potential and numerous use cases that are poised for future expansion. While Binance’s immense popularity may be a contributing factor to BNB’s success, it would be inaccurate to overlook the constructive efforts made to refine and enhance Binance Coin into a dependable cryptocurrency that will not only continue its growth but also provide a superior alternative to traditional finance.
Today, BNB transcends its role as an investment or trading asset. It can be utilized for credit card payments, booking travel arrangements, and even making charitable donations. Therefore, if you seek to understand Binance Coin, this article aims to provide you with a comprehensive understanding.
Binance’s success can be attributed to its implementation of innovative solutions, competitive exchange fees, and an intuitive user interface. These factors have solidified Binance’s position as the leading cryptocurrency exchange globally, offering an extensive and comprehensive ecosystem that caters to the diverse needs of investors and traders alike.
The actions taken by Binance Exchange have instilled a strong level of trust and credibility in Binance Coin, propelling it to its current third position in the cryptocurrency ranking.
How Binance Exchange Came into Existence
Initially established in China, Binance commenced as an online cryptocurrency exchange with a primary focus on alternative cryptocurrency trading. Within a short span, Binance ascended to become the world’s leading exchange. Among the numerous factors contributing to this remarkable success, the primary attributes were high liquidity, low transaction fees, and additional discounts for users who made payments using Binance’s native cryptocurrency, BNB.
Binance boasts an impressive platform capacity, processing approximately 1.4 million orders per second. It facilitates trading for over 500 cryptocurrencies and virtual tokens.
Binance offers a comprehensive range of trade orders, including limit orders, market orders, stop-limit orders, stop-market orders, trailing stop orders, post-only orders, and limit take-profit/stop-loss orders. While withdrawal fees may vary depending on the currency and transaction amount, deposits are free.
In addition to its exceptional trading and exchange services, Binance Labs provides funding for promising cryptocurrency projects, while LaunchPad hosts emerging blockchain projects and API interfaces. These initiatives demonstrate Binance’s commitment to the holistic development of the blockchain ecosystem.
Presently, Binance’s headquarters have been relocated to Cayman Island due to growing concerns regarding potential restrictions on cryptocurrencies in China.
As of the date of this article, Binance is not currently accessible to U.S. customers, with a limited selection of available coins and tokens for trading. Furthermore, as of 2021, 22 U.S. states are not yet supported by Binance US, with New York being the most prominent exception.
While Binance presents some limitations, it remains a prominent cryptocurrency exchange. Let us delve deeper into the subject of Binance’s native cryptocurrency, BNB, and explore its rapid ascent to the top 5 cryptocurrencies.
What is Binance Coin (BNB)
Initially introduced as an ERC20 Ethereum-based cryptocurrency in 2017, BNB has since transitioned to Binance’s proprietary blockchain, the Binance Chain. As the native cryptocurrency of Binance Exchange, BNB served primarily as a utility token, incentivizing users to pay transaction fees at a discounted rate. However, its applications have expanded significantly, enabling its use for financial services, entertainment, online services, and a wide range of other purposes.
Given the rapid development of Binance Coin, the substantial price increase of 344,893% since its introduction in 2017 is fully justified. As of June 4th, 2021, BNB holds a market capitalization of $58.13 billion, ranking it behind only Bitcoin and Ethereum.
Binance Coin Burning history
Analyzing the total supply of BNB, it is evident that there has been a decrease from $170,532,825 to $169,432,937. This reduction is attributed to 15 burning events. Each quarter, Binance utilizes a fifth of its acquired profits to repurchase and permanently destroy coins held in its treasury. This practice is a common strategy employed to reduce the total supply of coins in circulation, thereby mitigating inflationary pressures.
The 15th quarterly BNB burn stands as the largest in history, with a substantial amount of $595,314,380 worth of U.S. dollars being burned.
What is BNB Used for?
In addition to transaction and trading fees, Binance has transformed into a legitimate cryptocurrency capable of various applications, including credit card payments, investments, loans, transfers, and payment processing. However, Binance coin’s utility extends beyond financial services, as it can now be utilized for travel services, virtual gifts, and even charitable donations. These applications are anticipated to expand due to the planned collaborations and partnerships.
Legal Issues in the U.S
According to Bloomberg, Binance Holdings is currently under investigation by the Justice Department and the Internal Revenue Service for potential money laundering and tax evasion charges. However, the investigation is ongoing, and no official conclusions have been reached regarding the validity of these allegations.
What does the Future Hold for BNB?
Amidst the ongoing investigation in the United States, Binance experienced a significant decline in value, falling from $678 to $240 during the second and third weeks of May. However, the coin has since recovered to $378 as of June 4th, when this article was written. Given the ongoing legal proceedings, investing in Binance Coin presents a challenging situation.
If Binance is held liable for the allegations, the negative publicity and potential fines could have a detrimental impact on its price. Nevertheless, since Binance is registered in the Cayman Islands, even in the most unfavorable scenario, the company will temporarily suspend services for U.S.-based users, which are already subject to restrictions, while users from other countries will not be affected.
On the other hand, Binance’s exceptional services and ongoing developments suggest substantial future potential, which is likely to drive up BNB’s value over time. Despite the uncertainty surrounding the situation, Binance Coin remains a viable investment option for holders, according to market analysts. However, scalpers should exercise caution and monitor the potential outcomes of the legal battle.
Should I Buy BNB?
In the long term, financial experts anticipate that 2021 will be the pivotal year for BNB, potentially reaching a target value of $1000. Nevertheless, the ongoing legal proceedings have introduced an intricate turn of events that may not determine the success or failure of BNB’s growth. While it may not be a decisive factor, it has the potential to impede the company’s progress. Consequently, patiently awaiting the trial outcomes is a prudent decision.
How can I cash out BNB?
You have the option to cash out BNB through Binance or any other exchange where you hold your Binance Coins. If you encounter KYC challenges with your exchange for cashing out BNB or other cryptocurrencies, you can conveniently exchange your BNB for PayPal or Webmoney at ChinaitechPay.
Conclusion
It is an impossible task to be able to secure the number one spot as the best online exchange platform in the super competitive cryptocurrency market and at the same time introduce a native cryptocurrency that is placed 3rd in the ranks amongst giants such as Bitcoin and Ethereum, all in an unbelievably short period of time. But somehow or another, Binance has surpassed expectations, proving to be a capable platform that can handle 1.4 million orders per second and stand way above competition by utilizing creative methods to further develop not only its platform but also the blockchain network. BNB, as the 3rd cryptocurrency, has proven its significance in the market and is expected to have a bright future ahead. The investigation carried out in the U.S seems to be another challenge amongst many others that must be dealt with. Yet taking a look at Binance’s history, we find numerous challenges on an even greater scale that have been successfully overcome.
Disclaimer
Generally, investing in cryptocurrencies, decentralized financial tokens, and finance entails significant risks due to the absence of absolute guarantees of success. It is crucial to be cognizant of potential hazards and cultivate a tolerance for the possibility of investment losses.
It is important to recognize that market fluctuations are inherent, and investments can experience both upward and downward movements. At ChinaitechPay, we are prepared to facilitate the exchange of your cryptocurrency assets at any time. Additionally, we are committed to educating our users on various relevant topics. As a reminder, it is advisable to refrain from investing in assets for which you lack sufficient knowledge. Furthermore, it is prudent to allocate funds that do not necessitate immediate liquidity.
