- It offers blazing fast transactions.
- It is useful for selling and buying a lot of cryptocurrencies.
- It is fortified with top-notch safety measures.
- Some service providers in the hospitality/travel sector support it already.
- BNB is limited to the Binance exchange
- There are no smart contracts supported by BNB
Despite the uncertainty of legal status and lack of regulatory entity bottlenecking its growth and adoption, there is no stopping the cryptocurrency sector. More crypto coins are being developed with time, and major banks and financial entities are warming up to crypto technologies, gradually. Apart from the tycoons and technology giants, many investors are getting involved in the cryptocurrency sector. To use crypto assets and invest, it is necessary to use any of the crypto exchanges. Binance is regarded as the largest cryptocurrency exchange platform, globally. A native cryptocurrency called Binance Coin was created to enable paying for its services exclusively.
What is the Binance Coin, after all?
Binance Coin or BNB was set up to pay for the trading charges on the Binance crypto exchange ecosystem. Binance clarifies that BNB is meant for use as a utility coin and so it should not be used outside the Binance ecosystem. It is not exactly a competitor to Bitcoin, for that matter. Neither is it meant to be used in lieu of traditional fiat currency. It is an Ethereum-based token, unveiled on July 21, 2017, the day on which Binance launched its ICO. It used the Ethereum network in the early days but now it is powered by the Binance Chain, Binance’s own Blockchain. As of now, BNB is ranked as the 4th biggest cryptocurrency in terms of market capitalization.
So, what are the uses of BNB/ Binance Coin?
The main use of BNB is paying for Binance trading charges. Apart from that, it can also be used for:
- Pay for flight and hotel bookings done at Travala.com and Trip.io.
- Pay for certain goods and services for in-store, online buying using Binance Pay.
- Donate on Binance Charity services.
- It has become popular owing to support from partnerships with notable entities including Uplive, a live video streaming platform. Binance coin is supported by Monaco VISA debit card.
Binance Coin’s value
Unlike popular cryptocurrencies like Bitcoin and Ethereum, Binance Coin’s value has been stable from the time of its inception. On average, its value has been around the $20 mark since the beginning. However, in May 2021, Binance Coin (BNB)’s value soared upwards and reached $915. It is still not clear what led to the massive surge in its value. However, crypto sector experts think it could be triggered by either business moves of Binance or architectural changes made to its blockchain network. While BNB cannot be referred to as an instance of runaway crypto success, there is no denying its stability and accessible price, as opposed to its more popular counterparts.
Can BNB be used on Binance Singapore?
Crypto investors interested in BNB should keep in mind that BNB is used as a payment method for the Binance International Exchange. It cannot be used at Binance Singapore. The Binance Cash Wallet offered by Binance Singapore is not equivalent to Binance Coin. The Binance Cash Wallet is much like other digital and crypto-wallets. However, it is possible to sell and buy BNB on the crypto exchange of Binance Singapore.
How Binance Coin manages to retain its value?
Binance Coin relies on a hybrid system comprising of a coin sink and supply cap to retain its value, over the years. There is a Quarterly Burn system in place which keeps BNB scarce and its transaction fees remain stable. This is in stark contrast to the ever-growing transaction fee of Ethereum. Binance has plans to burn 100 million Binance Coins eventually and so far only 30 million have been burnt.
Should you plan to buy Binance Coin for investment purposes?
The clear answer to this question is no! Binance Coin isn’t meant for investing in the crypto sector, to begin with. You should buy BNB only if a transaction needs to be made in any section of the Binance ecosystem. Binance clarifies BNB is a utility token. You can buy BNB using Singapore Dollars through Binance Singapore. Then, you can transfer the amount to Binance International.
What are the advantages of using BNB?
Of course, there are advantages to using BNB for crypto sector investors. Binance helps bring down trading fees by a margin of 50% if you use BNB to pay for these. So, for a transaction worth $100, you have to pay just 5 cents if you use BNB. If you do not use BNB, churning out 10 cents may be required.
BNB is not only good for reducing the crypto trading charges made on the Binance ecosystem.
So, what is the suitability of Binance Coin for crypto enthusiasts?
Binance Coin is the official cryptocurrency made by the Binance exchange and it remains a utility token. So, it is not meant for casual and amateur crypto users and investors. Beyond the Binance crypto ecosystem, its usage is somewhat limited. A handful of accommodations and entertainment sector entities support it, as of now. While it is secure as a non-native crypto coin, it is not exactly as anonymous. Binance traders need to have registered accounts. Even with the limitations, there is no denying the advantages of using BNB.