What is BNB (Binance Coin) and How Does It Work?

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BNB coin, or Binance Coin as it’s also called, is one of the most widely used cryptocurrencies on the market today. But what exactly is it and how does it work? In this article, we’ll break down the basics of BNB and explore some common questions around this popular crypto token.

What is the purpose of BNB (Binance Coin)?

BNB was created by Binance, the world’s largest cryptocurrency exchange by trading volume, as the native token for its platform. Its main utility is to provide users with discounted trading fees when making transactions on Binance. Specifically, users can save up to 25% on commissions by choosing to pay with BNB instead of fiat currencies like USD. This model allows BNB to serve as a coupon of sorts for the exchange.

How does BNB (Binance Coin) work?

Technically, BNB operates on the BNB Smart Chain blockchain, a proprietary network designed and maintained by Binance. This means transactions settle and are verified much faster than on more congested blockchains like Ethereum. New BNB tokens are created and “mined” through a process known as “coin burning”, where a portion of trading fees collected by Binance are permanently removed from circulation. This deflationary mechanism is intended to maintain long-term price stability for BNB holders.

Does BNB (Binance Coin) have a future?

Bnb binance coin future

Many analysts think so. With Binance dominating the crypto trading landscape and continually expanding its product offerings, BNB’s use case and demand are expected to grow substantially in the years ahead. The exchange releases quarterly reports highlighting new ways it’s integrating BNB, such as allowing users to pay for goods and services from certain merchants with their BNB holdings. As Binance venture into decentralized finance and other emerging crypto niches, BNB’s role and value proposition are poised to strengthen further. Thanks to EXEcrypto, anyone can get future news of BNB very fast.

When BNB (Binance Coin) launched?

BNB had its initial coin offering (ICO) in July 2017, just a few months before Binance launched as a fledgling exchange. The ICO sold 100 million BNB tokens at a price of $0.15 each and raised a total of $15 million USD to help fund Binance’s early development and operations. Looking back, those who purchased BNB during the ICO have seen incredible returns as the token has appreciated over 100x from its original price.

Is BNB (Binance Coin) a scam?

Definitely not. As the native token of one of the most trusted and legitimate cryptocurrency platforms, there is no credible evidence that BNB itself is a scam. Binance is a professionally run company that has built an enormous, loyal user base. However, like any emerging technology, cryptocurrency does attract some dishonest players looking to take advantage. Investors simply need to do proper research on any project or token before investing to avoid potential scams hiding in the mix. But for BNB, its strong use case, performance track record, and association with a proven trading venue suggest its a reasonably safe bet.

Is it safe to invest in BNB (Binance Coin)?

Bnb binance coin safe

Due to BNB’s proven utility, robust trading volumes, and adoption by millions of users worldwide, many experts say it presents a relatively low-risk investment compared to less established crypto assets. Like all speculative investments, there are no guarantees in cryptocurrency. However, as one of the largest and most widely accepted networks today, the risks of BNB suddenly losing all value seem fairly small. Diversifying into this top coin alongside popular blue-chip cryptos like Bitcoin and Ethereum can provide a solid foundation for balancing safety and upside potential in a crypto portfolio. Of course, only invest what you can afford to lose.

Is BNB (Binance Coin) coin worth it? BNB Price 2023

The answer depends on an investor’s goals and horizon. In the near future, BNB could continue appreciating strongly as Binance expands. It reached an all-time high above $690 in 2021, and some analysts predict prices over $1,000 are possible in 2024 if bullish macro trends persist. For those holding long-term, BNB has handily outperformed Bitcoin since its inception and seems poised to remain a core crypto utility token powering one of the largest companies in the industry. So speculation aside, the sheer usage BNB generates simply by virtue of its role on Binance gives it compelling long-term worth and staying power in the market for years to come.

Where to buy BNB (Binance Coin)?

The most direct place to purchase BNB is on the Binance exchange itself, where it can be traded against currencies like Bitcoin, Ethereum, and popular stablecoins like USDC. However, BNB is also available on almost every major crypto exchange, including Coinbase, Bybit, OKX and others. Investors outside the US tend to prefer Binance for its low fees and wide selection of altcoin pairs, while Americans have more options on alternative platforms that operate within regulatory guidelines. BNB can also sometimes be found on PayPal and certain crypto brokerages. Just be sure to verify any exchange is reputable before signing up.

How to sell BNB (Binance Coin)?

Bnb crypto binance coin

The process for selling BNB follows similar steps as buying, but in reverse. Once logged into your exchange account where BNB is held, go to the “sell” or “trade” spot on the app or website. Select BNB in the “from” currency field and the crypto or fiat you want in return in the “to” side. Enter the amount you wish to sell, review slippage and fees, then hit confirm to place the order. It will be matched with a buyer and the funds deposited into your exchange wallet instantly or within a couple days if withdrawing to an external account. Selling crypto for a profit comes with tax implications too depending on jurisdiction.

How to stake BNB (Binance Coin)?

Staking BNB gives holders an opportunity to generate passive income from their tokens. It involves locking up BNB for a set period to validate transactions on the BNB Smart Chain network in exchange for rewards. Users can do this directly through Binance’s staking portal or delegate their tokens via third-party staking pools. Annual percentage yields tend to range from 2-5%, paid out daily. Staking requires keeping coins on centralized platforms, so there is counterparty risk versus self-validating on a hardware wallet. But it remains a fairly low-effort way for BNB believers to multiply their stack over time.

How to mine BNB (Binance Coin)?

BNB is not technically mined through conventional proof-of-work like Bitcoin. Instead, as mentioned earlier, new tokens are created and purportedly “burned” through a process associated with the fees collected by Binance exchange. Therefore, the only way individuals can obtain BNB is by purchasing it on supported trading platforms rather than through energy-intensive mining. This unique emission model aims to keep BNB deflationary while giving Binance centralized control over supply. Nonetheless, BNB holders can still passively generate returns by staking or providing liquidity on platforms like PancakeSwap.

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