The name “Binance” is a combination of “Binary” and “Finance”. Today it is the most popular cryptocurrency exchange in the world, with $ 1.5 billion trades daily. Binance has its native BNB coin that fuels all inner processes operated in the exchage.
The exchange is designed for cryptocurrencies only, so you won’t be able to buy BTC for USD or EUR. However, you can buy BNB for USD on Binance and exchange BNB to other supported cryptocurrencies, Bitcoin, Litecoin, Ethereum, Dash, Ripple etc.
What is Binance Coin (BNB Coin)?
BNB has a big value risen with the Binance exchange growth and takes a place in Top-15 coins in the world. It’s a Binance cryptocurrency that works on the Ethereum Blockchain using the ERC-20 protocol and has a strict limit of 200 mln BNB.
That means BNB will be deflated and steadily raise the price if the demand stays the same. Binance has a plan to BNB buyback – they will spend 20% of their profit to redeem BNB and burn it until 50% of the full supply will be burnt. Only two burns have been taken so far. These measures help prevent the coin inflation, i.e., save value of Binance Coin in the future. The exchange has already burned about of 2.5 mln BNB ($ 30 mln USD).
"Every quarter, we will use 20% of our profits to buy back BNB and destroy them, until we buy 50% of all the BNB (100MM) back. All buy-back transactions will be announced on the blockchain. We eventually will destroy 100MM BNB, leaving 100MM BNB remaining."
What is Binance Coin (BNB) needed for?
BNB provides many options in the Binance ecosystem, including bidding, exchange, listing and any other fees. Although the Binance fee payment is the main option of BNB, it also may be used to invest in some ICOs.
BNB has additional options in other systems. Monaco supports BNB on its platform and it makes possible to use BNB with Monaco Visa Card.
In the future, Binance plans to launch their own decentralized Blockchain and it's called Binance Chain. Binance will use the BNB token for it, so it should raise up the coin's value.
When it will be launched BNB will be used to pay for transactions and exchanges on the blockchain, just as the ETH is used to pay for transactions on Ethereum.
Is BNB perspective?
The value of BNB is easy to understand because it is interconnected with the profit of a Binance exchange business, it's not a business idea, it's real existing business.
- Binance’s proposal to its users low fees and a fast trading engine so it attracts a lot of users.
- Binance provides users with a discount if they pay a fee in BNB, so BNB is constantly trades.
- Binance is burning their coins so it may will result in increase of it's value if the demand stays the same but supply decreased.
How the BNB value is building by?
- The low fees attract new users
- BNB users are constantly trades it
- Binance burning BNB to increase the value
If you are interested to hold BNB as an investment, you should store it from the exchange to your own wallet. Pay your attention that custodial wallet it's almost the same as the exchange. So it will be better to have a cold or a non-custodial wallet.
In a non-custodial wallet, like Atomic Wallet, you can store and manage your BNB in a decentralized way. Your private keys will be generated by your mnemonic seed phrase and stored in an encrypted manner on the end-user device, so your money is totally under your control.
But if your device will be lost or stolen you will able to restore access to your assets by your mnemonic phrase that you saved in a safe and secret place.