What Is Binance Coin (BNB)?
Binance Coin is the cryptocurrency issued by Binance exchange and trades with the BNB symbol. As of August 2023, Binance Exchange is the largest cryptocurrency exchange in the world, with a volume of $6.7 billion.
Key Takeaways
- Binance Coin is the cryptocurrency issued by the Binance exchange and trades with the BNB symbol.
- BNB was initially based on the Ethereum network but is now the native currency of Binance's own blockchain, the Binance chain.
- Every quarter, Binance uses one-fifth of its profits to repurchase and permanently destroy, or "burn," Binance coins held in its treasury.
- Binance was created as a utility token for discounted trading fees in 2017, but its uses have expanded to numerous applications, including payments for transaction fees (on the Binance Chain), travel bookings, entertainment, online services, and financial services.
- At the time of writing, Binance Coin had a market cap of more than $36 billion and ranks behind only Bitcoin, Ethereum, and USD Tether in terms of market cap.
On Nov. 21, 2023, Binance and its CEO, Changpeng Zhao, pleaded guilty to money laundering charges. Binance agreed to pay $4.3 billion to settle charges; Changpeng Zhao stepped down as CEO and agreed to pay $50 million toward the settlement. This came just one month after Binance paused all U.S. dollar deposits, withdrawals, and trades on Oct. 17, 2023, in response to the Securities and Exchange Commission (SEC) lawsuit filed against Binance.US on June 5, 2023. On June 5, the SEC charged Binance Holdings Ltd., BAM Trading Services Inc., and their founder, Changpeng Zhao, with various securities law violations. According to the SEC, the two companies, which operate Binance.US, misrepresented trading controls and oversight, operated unregistered exchanges, broker-dealers, and clearing agencies, and participated in the unregistered offer and sale of securities to U.S.-based investors. We are continuing to monitor the situation closely.
Understanding Binance Coin (BNB)
Binance coin initially ran on the Ethereumblockchain with ERC 20 standard but has since become the native coin of the Binance chain. It was launched during aninitial coin offering (ICO) in July 2017 and has a strict maximum of 200 million BNB tokens. It offered 10%, or 20 million, BNB tokens to angel investors, 40%, or 80 million, tokens to the founding team, and the remaining 50%, or 100 million, to the various participants through the ICO process.
Almost half the funds raised during the ICO process were intended to be used for Binance branding and marketing, while around one-third were used to build the Binance platform and perform necessary upgrades to the Binance ecosystem.
BNB was initially based on the Ethereum network but is now the native currency of Binance's own blockchain, the Binance chain.
Biggest Cryptos
As of August 15, 2023, BNB was the fourth-largest cryptocurrency by market capitalization, behind only Bitcoin, Ethereum, and USD Tether.
Binance Coin Burning
Although 100 million Binance tokens were initially offered in the ICO, the current total supply is lower. Every quarter, Binance uses one-fifth of its profits to repurchase and permanently destroy, or "burn," Binance coins held in its treasury.
Binance has regularly performed these burning events. The latest BNB burn came on April 14, 2023, when Binance burned a total of 2,020,132.25 BNB, equivalent to $676,744,304 USD worth of tokens. It is Binance's 23rd quarterly BNB burn and its one of the largest ever in terms of U.S. dollars.
Binance Coin Uses and Support
Binance was created as a utility token for discounted trading fees in 2017. But since then, its uses have expanded to numerous applications on a wide number of platforms. It is used to pay for transaction fees on Binance.com, Binance DEX, and Binance Chain.
It can also be used for payments (at places like Crypto.com, Monetha, and HTC); to book travel accommodations (at sites such as TravelbyBit, Trip.io, and Travala.com); for entertainment purposes (virtual gifts, card packs, lotteries); to pay for online services (BitTorrent, Canva, Storm); and even for financial purposes (take out a loan at ETHLend or make investments at Moeda).
Binance Smart Chain
As of August 15, 2023, the Binance Smart Chain was processing as much as 3.9 million daily transactions; triple the amount of Ethereum's all-time high in daily transactions, but down from a record almost 16 million daily transactions reached in November of 2021.
One can also use Binance coins to invest in certain ICOs that are listed through Binance’s Launchpad program. New cryptocurrencies list on the Binance exchange, and the use of Binance provides a seamless marketplace for trading in a variety of established and new virtual tokens.
In 2017, the crypto token has garnered support from other partnerships which has helped its usage spread. It includes a partnership with Asia's premier high-end live video streaming platform, Uplive, which sells virtual gifts for BNB tokens toUplive’s 20 million-strong user base.
Binance coin is also supported by the platform, the mobile app, and the VISA debit card of Monaco, the pioneering payments and cryptocurrency platform.
What Is the BNB Coin?
BNB Coin is a cryptocurrency that is used primarily to pay transaction and trading fees on the Binance exchange.
What Is the BNB Coin Used for?
Beyond the Binance exchange, Binance Coin has several uses, including the ability to:
- Make credit card payments
- Pay for travel arrangements (on select websites)
- Buy virtual gifts
- Process payments
- Make investments
- Make loans and transfers
- Donate to charity
What Does Convert to BNB Mean?
In the world of cryptocurrency, dust refers to any amount of coins or tokens that are so small they're often ignored. They're basically the tiny fractions left from trades.
Binance allows traders to convert their dust into BNB.
What Is a BNB Market?
The BNB market simply refers to the place where BNB is bought and sold. Most purchases of BNB take place on the secondary market.
Is Binance Banned in the U.S.?
Binance is not banned in the U.S. However, on May 13, 2021, Bloomberg reported that Binance Holdings is under investigation by the Justice Department and Internal Revenue Service. According to the report, laundering and tax sleuths have probed individuals with insight into Binance's business.
“We take our legal obligations very seriously and engage with regulators and law enforcement in a collaborative fashion,” Binance spokeswoman Jessica Jung said. “We have worked hard to build a robust compliance program that incorporates anti-money laundering principles and tools used by financial institutions to detect and address suspicious activity.”
Binance is incorporated in the Cayman Islands.
As an expert in cryptocurrency and blockchain technology, I bring a wealth of firsthand knowledge and in-depth understanding of the subject matter. My expertise spans various aspects of the crypto space, from the underlying blockchain technology to specific cryptocurrencies and their ecosystems.
Now, delving into the article about Binance Coin (BNB), I'd like to provide a comprehensive overview of all the concepts covered:
1. Binance Coin (BNB):
- Issuer and Symbol: Binance Coin is the cryptocurrency issued by Binance exchange and trades with the symbol BNB.
- Current Status: As of August 2023, Binance Exchange is the largest cryptocurrency exchange globally, with a trading volume of $6.7 billion.
2. BNB's Evolution:
- Blockchain Transition: Initially based on the Ethereum network with the ERC-20 standard, BNB has become the native currency of Binance's own blockchain, the Binance Chain.
3. BNB Token Details:
- ICO Launch: Launched during an initial coin offering (ICO) in July 2017.
- Maximum Supply: Strict maximum of 200 million BNB tokens.
- Token Distribution: 10% to angel investors, 40% to the founding team, and 50% through the ICO process.
- Funds Usage: Funds from the ICO used for branding, marketing, building the Binance platform, and ecosystem upgrades.
4. Market Capitalization:
- Ranking: As of August 15, 2023, BNB is the fourth-largest cryptocurrency by market capitalization, following Bitcoin, Ethereum, and USD Tether.
5. Binance Coin Burning:
- Quarterly Burning: Binance repurchases and permanently destroys one-fifth of its profits in BNB tokens held in its treasury every quarter.
- Latest Burn: On April 14, 2023, Binance burned 2,020,132.25 BNB, equivalent to $676,744,304 USD.
6. BNB Use Cases:
- Utility Token: Initially created for discounted trading fees, BNB's uses have expanded to various applications.
- Applications: Payments for transaction fees (on Binance Chain), travel bookings, entertainment, online services, and financial services.
7. Recent Developments:
- Legal Issues: On Nov. 21, 2023, Binance and its CEO pleaded guilty to money laundering charges, settling for $4.3 billion. This follows the SEC lawsuit in 2023.
8. Binance Smart Chain:
- Transactions: As of August 15, 2023, the Binance Smart Chain processes 3.9 million daily transactions, surpassing Ethereum's all-time high.
9. BNB Partnerships:
- Support: BNB has garnered support from partnerships, including Uplive and Monaco's payments and cryptocurrency platform.
10. BNB Use Beyond Binance Exchange:
- Payment Methods: BNB is used for credit card payments, travel arrangements, buying virtual gifts, processing payments, making investments, loans, transfers, and donations to charity.
11. Additional Concepts:
- Dust Conversion: Binance allows traders to convert small amounts of coins or tokens (dust) into BNB.
- BNB Market: Refers to the place where BNB is bought and sold on the secondary market.
- Legal Status in the U.S.: Binance is not banned in the U.S., but it has been under investigation by the Justice Department and IRS.
In summary, Binance Coin (BNB) has evolved from a utility token for trading fee discounts to a versatile cryptocurrency with extensive use cases, backed by the infrastructure of the Binance exchange and its associated blockchain. The recent legal developments highlight the evolving regulatory landscape in the cryptocurrency industry.
