Binance is the world’s largest crypto exchange, and Binance Coin (BNB) was created as an easy way to pay fees on the exchange. It has since been updated to become the native coin of the Binance Network, also known as Binance Smart Chain.
Binance is an extraordinary success story: Founded in July 2017 by Chinese-Canadian coder Changpeng Zhao, it came out of nowhere to become the world’s largest crypto exchange, with trading volume exceeding $ 2,000 billion in 2020. This made Zhao a few billionaire. times more – and all in the space of four years.
Its phenomenal growth rate has brought it to the attention of regulators in the we, Singapore and HER, to only cite a few. This review prompted him to stop offering futures and derivatives in some parts of the world in order to stay on the good side of the regulator.
Besides being an exchange for crypto trading, Binance is also a network that facilitates financial transactions using smart contracts, and to that extent, competes with Ethereum – the difference being that Ethereum is a decentralized exchange running on thousands of nodes or computers, while the Binance network appears to be much more centralized.
BNB has climbed over 1,400% in the past 12 months, one of many crypto assets to post gains of 1,000% or more.
Some of the steam has been pulled from the BNB in âârecent weeks, largely due to the aforementioned regulatory review.
However, there are compelling reasons to view BNB as part of a well-balanced cryptocurrency portfolio, says Brett Hope Robertson (BHR), investment analyst at Revix, who helps us understand the story behind BNB.
What exactly is Binance Coin, or BNB?
BHR: BNB is the native cryptocurrency of the Binance exchange. The Binance coin was originally created as an ERC-20 token on the Ethereum network, but has since moved away from it and developed its own network, the Binance Smart Chain. Binance Smart Chain is a contract-activated smart blockchain network created with the goal of creating a Decentralized Financial Ecosystem (DeFi).
First of all, BNB was created to make it easy for Binance users to pay trading fees and, moreover, as a utility token.
Now basically a utility token is a token that cannot be viewed as cash, but rather gives users access to products and services on that specific platform. In Binance terms, if you held the token, you would pay lower trading fees than if you didn’t.
As part of the Binance smart chain, you would also need BNB to pay the fees associated with smart contracts built on it. This is similar to how you use Ethereum to pay fees when using Ethereum-based smart contracts.
A key advantage of the Binance network is that it can run DeFi protocols, but at much lower costs and at higher speeds than Ethereum.
Although the kicker, without getting too technical, is that the Binance smart chain is not as decentralized as Ethereum likes and forgoes some decentralization for speed and lower costs.
We have already talked about “Ethereum killers” like Solana, Cardano, and Polkadot. These are networks – with their own native currencies – that compete with Ethereum to function as the platform for the next generation of financial services that will radically change the world. The Binance network could also be branded as a possible Ethereum killer because it already offers serious advantages over Ethereum in terms of cost and speed.
In fact, based on the total value locked in smart contracts, Binance Smart Chain is the second largest behind Ethereum. Total Locked-In Value (TVL) is simply the number of assets currently held on specific smart contract platforms. So TVL shows exactly which smart contract platforms attract the most money, and therefore the most adoption.
With a market cap of $ 71 billion, BNB is the fourth largest crypto by market cap, and there are plenty of good reasons to include it in a diverse crypto portfolio.
What is the main purpose of BNB and Binance?
BHR: BNB is a cryptocurrency that can be spent on the Binance trading exchange or by interacting with DeFi protocols built on its smart chain. Binance allows users to participate in multiple features, such as trading, investing, interest, lending, borrowing, and more. For all these features, you will be able to use BNB to pay the fees. Binance also encourages users to hold increasing amounts of BNB; users can benefit from a larger fee reduction by holding a larger amount of BNB.
There are many great reasons to own BNB whether or not you want to trade on the Binance network.
Perhaps the main reason is that it gives you exposure to the world’s largest crypto exchange, the second largest smart contract cryptocurrency, and one of the top performing crypto assets in recent years.
As noted above, the Binance Smart Chain offers faster transaction times, lower fees, and programming capability that makes it easy for developers to create complex smart contracts.
Yes, Binance has undergone regulatory scrutiny from various governments around the world, but it is actively trying to resolve these issues.
Is BNB a safe investment?
BHR: Like all cryptos, it is volatile, so you should expect crazy price swings, up and down. It’s not for the faint hearted, but at Revix we’ve always advocated for a diverse crypto wallet, and that wallet should include the world’s largest crypto exchange.
There are more profitable crypto assets out there, but we’re trying to strike a balance between cryptos that are fundamentally sound and those that will likely be around five years from now. Binance is arguably one of the most successful trading stories of recent years. Binance currently generates a total trading volume of around $ 60 billion to $ 90 billion per day, about five times more than its closest competitor.
How can people buy BNB?
BHR: Revix will be one of the first platforms in South Africa to offer Binance coin as a standalone cryptocurrency investment option. Revix will be offering Binance coins starting September 24 with a tempting promotion at no cost.
- Revix will offer no purchase costs on Binance coin purchases when using ZAR and GBP for one week (September 24 to September 30, 2021)
- Revix will also offer a refer a friend promotion whereby if you refer a friend using your referral code, you receive double the Revix rewards at the value of R600 by reference (the promotion is valid from September 17 to September 30, 2021).
This is Revix’s latest offering, following its recent launches of a number of altcoins such as Solana, Uniswap, Cardano, and Polkadot.
In addition to this, Revix offers “bundled” products:
The Top 10, which spreads your investment evenly across the 10 largest cryptocurrencies measured by market capitalization;
The Smart Contract package, which spreads your investment evenly across the top 5 smart contract cryptocurrencies; and
The payments package, which spreads your investment evenly across the top 5 payments-oriented cryptocurrencies, giving you balanced exposure to these areas of crypto.
Revix brings simplicity, confidence and excellent customer service to the investment. Its easy-to-use online platform allows anyone to securely hold the world’s best investments with just a few clicks.
Revix Guides new clients through the sign-up process to their first deposit and first investment. Once configured, most customers manage their own portfolio but can access support from the Revix team at any time.
For more information, please visit www.revix.com
This article is intended for informational purposes only. The opinions expressed are not and should not be interpreted as investment advice or recommendations. This article is not an offer, nor the solicitation of an offer, to buy or sell any of the assets or securities mentioned in this document. You should not invest more than what you can afford to lose, and before investing, please consider your level of experience, your investment goals and seek independent financial advice if necessary.
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