Binance Coin is quite a promising option for investment. Few cryptocurrencies were able to replicate the success of the Binance Coin (BNB), and a significant part of experts believe that the coin has a fairly positive future.
- Contents
- What is Binance Coin
- Operation principle
- Where and how to buy Binance Coin
- Possibility to mine coins
- Wallets for storing Binance Coin
- Features of Binance Coin
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- Examples of Binance Coin usage
- Binance Coin burn
- Bonuses for BNB holders
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- Advantages and disadvantages
- Prospects of Binance Coin
- Conclusion
What is Binance Coin
The BNB cryptocurrency was created to support the Binance exchange of the same name, which was created by Changpeng Zhao. The Binance Coin cryptocurrency is essentially a kind of analog of the digital “fuel” for the Binance exchange of the same name. It actually “fuels” this platform and the entire ecosystem. With Binance Coin, it is possible to save significantly on fees, and, in addition, it can be easily exchanged for any other asset.
There is nothing special about Binance Coin, but due to the popularity of the Binance platform and all of its subsidiaries, the Binance Coin cryptocurrency quickly became very popular. Thanks to Binance Coin, users have the opportunity not only to save money but also to earn it. This cryptocurrency is actively traded, used for investments, and so on.
Operation principle
The BNB cryptocurrency refers to the peer-to-peer simple systems, the distinguishing feature of which is good scalability and excellent bandwidth. It uses a special consensus mechanism known as BFT (Byzantine Fault Tolerance) worldwide.
It is noteworthy that this system is based on a theory invented back in the last millennium. BFT solves the problem of attacks by rogue nodes.
The network has a very limited function set, but this is its benefit due to the lack of redundancy; any transaction almost instantly, the creation of blocks takes less than a second, and the potential load the network can withstand is very high.
Where and how to buy Binance Coin
It is easy to buy the Binance Coin cryptocurrency on various sites, but it is best to go straight to the Binance exchange – the so-called “source.” Mainly active trades are conducted for USDT, so if you choose this pair, you can save a good deal on the purchase if you determine when the asset price will fall.
To buy Binance Coin on the exchange, you need:
- Go to the official website of the platform.
- Pass registration and identity verification.
- Select the “Buy Cryptocurrency” section at the top of the screen.
- Specify the payment method.
- Select the desired cryptocurrency. In this case, BNB.
- Specify the amount of the transaction.
- Make a transaction.
In addition, you can use other exchanges or the service of monitoring exchangers, but you should check them carefully beforehand so as not to fall for the tricks of scammers.
Possibility to mine coins
The Binance Coin cryptocurrency is not available for conventional mining. According to experts’ forecasts, there will be no access to free BNB mining shortly. Thus, the only way to get coins is to purchase them by any convenient method. Such an approach allows the coin’s creator to control inflation on his own, especially since this is not the only way to control it.
Wallets for storing Binance Coin
All wallets that are suitable for storing Binance Coin are divided into several main categories:
- Online. The most convenient, fastest, and fairly reliable option.
- Mobile. A kind of analog of online storage, but the currency is on the user’s smartphone. It is implemented through a special application. In general, this is also a convenient and simple way of storage.
- Software. This option involves the installation of special software on the PC. This program is the wallet in which Binance Coin is stored. The complicated functionality often scares off the user but is a frequent choice of experienced investors.
- Hardware. The most reliable and secure way implies the use of special equipment. It is also the only paid because this equipment must be purchased first. Money is stored on a device like a flash drive, which is connected to your computer only when needed. The device must be disconnected the rest of the time, eliminating the possibility of hacking.
Most users choose online wallets. Not everyone is ready to spend time studying the broad and sometimes complex functionality. Usually, users are looking for the simplest option. Wallet https://bnbwall.com/ offers a simple, intuitive interface and reliability. This is why users choose this service.
Another simple way to store Binance Coin is the user’s deposit on the Binance exchange itself. However, this storage method can hardly be called secure, so many users are looking for alternatives. There are a fairly large number of them.
Note a few more popular wallets:
- Trust Wallet;
- Jaxx Liberty;
- Exodus;
- Atomic Wallet;
- Ledger.
The last option is a hardware version; you will have to pay for the hardware first. On the other hand, this is the most secure option for storing Binance Coin, so you should pay special attention to it.
Features of Binance Coin
The BNB cryptocurrency, even though it is quite typical, still has several features that set it apart from its competitors. The features include:
- Own token of the Binance exchange.
- Available for use in projects related to the Binance network. For example, Skycoin and Qlink.
- Highly attractive to investors and young companies.
- Active trading on exchanges.
- It can be used for the reduction of commissions on exchange Binance.
- Used in many trading pairs.
- The mechanism of token burn for additional inflation control is used.
- Little dependence on the current rate of Bitcoin.
As mentioned above, the coin is not something radically new and innovative. But it works and performs its tasks just fine. Most users just prefer Binance Coin for its predictability and clarity. However, Binance Coin is constantly evolving, and new features are appearing, so there is a place for those who like innovation.
Examples of Binance Coin usage
There are many ways to use Binance Coin. For example:
- Paying commissions and fees on the Binance exchange. Any commissions will never seem too small, so this is a good way to lower them even more.
- The BNB token is used in crypto trading. A lot of people are making money with it. And it is possible to earn income from trivial long-term speculation and, simultaneously, from active trading on the exchange.
- Paying for online goods through various applications.
- Exchanging liquidity on the Binance cryptocurrency exchange.
- For transfers for charitable purposes.
- For purchasing physical goods and services through a special Binance bank card. Currently, it is not supported in all countries, but the exchange management is doing everything to expand the list of regions.
This is not all but the main ways to use the Binance Coin cryptocurrency. In general, it can be used in any situation, by analogy with the popular Bitcoin and almost everywhere it is used.
Binance Coin burn
To keep the BNB token from falling victim to inflation, that is, to keep its price from plummeting, Binance buys many coins every quarter, using about 20% of its total profits. All of the coins bought back are destroyed. This process is also called “coin burning.”
This method of combating inflation is very effective, which positively affects the Binance Coin’s popularity and increases its value. Also, many traders purposely choose the moment of burning to sell or buy coins at a profit.
Keep in mind that Binance Coin has no limit on the number of coins, so the need for burning is very high. Otherwise, the coins will quickly become so widespread that they will plummet in value. That’s why Binance regularly arranges such burns systematically.
Bonuses for BNB holders
In addition to all mentioned above, the BNB (Binance Coin) token provides bonuses to all holders. For example, 25% of the amount of commission on the Binance cryptocurrency exchange when trading on margin.
In addition, holders of the coin will pay 10% less in commissions on future transactions and get the opportunity to participate in the IEO via Binance Launchpad. You can buy various assets and get rewards, so it’s a very lucrative bonus option.
Also, the Binance exchange clients who have BNB Coin can become members of the Binance VIP program, in which you can get even better and faster service.
Another bonus from Binance Coin is associated with the referral program. For example, the users of BNB coin get up to 4% of all commissions of the attracted persons.
Apart from that, users who have BNB on their hands can additionally earn through stacking, but that is not all. We can also note an important feature: all holders of Binance Coin can get a cryptocurrency loan on the exchange of the same name.
Advantages and disadvantages
Like any system of this type, BNB has both advantages and disadvantages. Of course, if you compare it with its counterparts. To begin with, the disadvantages are only one: the system has centralized management, which is radically different from the general idea of cryptocurrency.
Obviously, this is why many users categorically refuse to work with the cryptocurrency Binance Coin and the platform it provides. But given Binance Coin’s profitability and prospects, most crypto sphere participants prefer to ignore this disadvantage.
Now for the advantages:
- The network is secure. It’s not surprising that security and protection are given much attention, considering that the Binance exchange is a large company.
- Like many competitors, there were problems with scammers and hackers after the creation of the exchange. Still, all the possible security holes are closed and systematically working to find potential bugs that need to be fixed.
- Of course, it is not the best idea to keep money on a Binance deposit all the time, but in general, it is quite reliable storage for operational work and local transactions.
- Very fast speed of transactions. This has already been written about before, but we must remember this fact again. All transactions and operations are almost instantaneous and positively impact the prestige, image, and popularity of Binance Coin.
- As a result, this cryptocurrency is gradually acquiring more and more new users, which positively affects its liquidity, and its price is growing. And this already suits everyone, both the developers and ordinary users.
- The mechanism of protection against inflation. This is most clearly seen in the burn of Binance Coin tokens. Thanks to this feature, which the company regularly translates into action, it is possible to maintain a consistently high value of coins.
- At the same time, the price is not inflated and is quite affordable for most crypto sphere participants. Such an approach also allows regular trading of the asset working at the moment of burning. Many traders make money this way.
- Lots of possibilities for application. Thanks to Binance’s rather extensive ecosystem, Binance Coin can be used in many different ways. Moreover, the company regularly develops new methods and actively cooperates with many firms; therefore, over time, more and more options for Binance Coin will appear.
These are not all the benefits, but the most obvious and illustrative ones, especially considering user feedback. Every holder of BNB Coin will be able to find many other advantages. However, there are also disadvantages because it is impossible to please everyone, and what is a plus for one will be a significant drawback for another.
Prospects of Binance Coin
It should be said right away that it is impossible to predict the future and prospects of any project, even such a large one as Binance Coin. But based on general parameters, statistics, characteristics, and history of different cryptocurrencies, we can make certain conclusions. In particular, this forecast will be based on the following indicators:
- The Binance Coin token is used not only on the exchange itself but also outside it.
- The performance of Binance Coin cryptocurrency by the results of the past years.
- The current state of the Binance exchange and the crypto sphere in general.
As already mentioned, Binance Coin is not only relevant for those users who work on the exchange with the same name. It can and is used in many other spheres, making it more popular and in demand. This is already a good indicator of the future growth and development prospects of Binance Coin.
In addition, Binance Coin is tied to the performance of the exchange. The more the Binance platform thrives, the better for the coin. This is another plus for the prospects of further price growth. Binance constantly evolves, with new branches opening and new services, features, and functions appearing. As a consequence, Binance Coin is getting more expensive.
Another important factor that also affects the popularity and prospects of Binance Coin is a special launch pad for IEO. It attracts new projects to finance, in a completely legal and regulated manner, making the platform popular among project creators and investors.
Well, not the least role is played by the general system of development of the crypto sphere. Even though, year after year, it is predicted a complete wreck, the cryptosphere continues its development. There are too many opportunities for it to become dramatically unpopular. Even the restrictive measures introduced by some countries cannot affect the overall growth in the popularity of cryptocurrency.
Conclusion
Binance Coin is an interesting project that has many important features. Binance Coin is great to use both to reduce the commission costs of trading on the Binance exchange and to get other benefits or bonuses.
Moreover, you can use Binance Coin in many different ways, including as a lucrative investment or simply as a common asset, just like any other currency, to buy various goods or services.