If you are interested to the previous posts of this series, check it out here:
What is it?
Binance Coin was created by the eponymous Chinese exchange, which ,to date, is also the largest exchange in the world by daily transaction volume. Its popularity has now surpassed big competitors like Coinbase, GDax or Kraken. Its clientele also extends well beyond China, now reaching almost every nation in the world. As Binance's reputation grows, the team of developers supporting it has continued to introduce new features. Starting as a simple way to exchange traditional money into virtual currencies, several services have now been implemented. First the possibility of using it as a wallet, then the training area to learn more about the world of cryptocurrencies, then even the startup incubator, the software to launch ICOs, the charitable foundation and finally its own cryptocurrency. The reasons for its success must be identified in the fact that Binance Coin allows you to invest in an alternative cryptocurrency, with an independent market and with unique characteristics. Binance Coin boasts cutting-edge technology, the same as the Ethereum (ETH) blockchain. In fact, the algorithm is the same as ETH and is the Proof-of-Stake (POS). Binance Coin can therefore be considered as an ERC20 smart contract. Which also means a fair amount of scalability, even if other faster and more efficient cryptocurrencies are emerging, so much so that they are called "Ethereum Killer". When the Initial coin offering (better known as Ico, the fundraising to raise funding to launch a cryptocurrency) took place, more than 200 million tokens were introduced.
How does it work?
Let's see what the BNB token is and how does it work, which is an integral part of the Binance Coin blockchain. BinanceCoin (BNB) is an ERC20 token issued on the Ethereum blockchain by Binance. Through it, you can pay a transaction fee directly on Binance. By paying commissions on Binance via Binance Coin, you can receive substantial discounts. With this proportion:
- First year: 50% discount
- Second year: 25% discount
- Third year: 12.5% discount
- Fourth year: 6.75% discount
The total supply of BNB is 200 million. The Whitepaper predicts that Binance will use 20% of profits each quarter to buy back and "burn" BNB, until half of the total BNB supply is exhausted (ie 100 million). The BNB token also allows you to obtain discounts on the services offered on the Binance platform. Finally, the BNB token provides users with access to advanced features.
Where to store it?
These are the best wallets to store your Binance coins:
- Trustwallet: Trust Wallet is a multi-crypto digital wallet, Binance's own official one
- Hardware wallet: offline cold storage. The most secure ones
Pros&Cons
*DISCLAIMER* These lists are subjective, it depends from person to person
Pros
- Binance's project is huge and links Binance Coin to over 400 cryptocurrencies
- Binance tries to avoid deliberately eliminating BNB from the market
- The bullish trend of Binance Coin will follow the general trend of the crypto market
Cons
- The possibility of Binance undergoing a cyber attack puts the value of Binance Coin at risk
- The company's performance will greatly affect the price of the cryptocurrency
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