What's Binance Coin and what's so special about it?
Binance Coin (BNB) is a cryptocurrency created on the Binance Chain which helps power the Binance Chain ecosystem. Binance Chain was developed by Binance, a worldwide cryptocurrency trading platform founded by Zhao Changpeng, or “CZ”. Binance Coin was launched during its initial coin offering (ICO) in July 2017.
Originally, Binance Coin was an ERC-20 token that operated on the Ethereum network, but later on, Binance Chain was launched and developed its own token standard, BEP2, running on the Binance Chain with Proof of Staked Authority (PoSA).
Binance Coin has a total circulating supply of 200,000,000 coins in the system, and the coins will be reduced by the “Coin Burning” protocol, which takes place every quarter. This will burn up to 100,000,000 BNB or 50% of the total coin supply. The amount of BNB burned depends on the trading volumes within a 3 month period.
Binance Coin is a coin that can be utilized in various beneficial ways on the Binance trading platform, for example;
As a discount on trading fees on the trading platform.
Used to fund an IEO (Initial Exchange Offering) on Binance Launchpad, a platform for funding new cryptocurrency projects.
To participate in voting activities such as selecting new cryptocurrencies to be listed on the platform
Binance Coins can be borrowed for a return.
Currently, there are Decentralized Finance (DeFi) platforms, such as Pancakeswap, running on Binance Chain, which makes Binance Coin into a coin that can be used as transaction fees or invested in DeFi that are built on Binance Chain.
Pros of Binance Coin
1. Discount on trading fees
Binance Coin can be used to pay trading fees on Binance exchanges and receive special discounts. However, users need to hold enough BNB to pay the fee, which users can turn the remaining small amount of coins in the wallet into BNB coins to reduce fees or keep them.
2. Assorted benefits
This is because Binance trading platform offers a wide range of services, and Binance Coin can be used for various services such as IEO funding or voting for new coins on the exchange.
Binance Smart Chain
The Binance Smart Chain is considered to be faster than the Ethereum Blockchain, while also offering cheaper fees. As a result, the transaction cost can be greatly reduced, leading to developers building Decentralized Applications (dApps) and other DeFi products. This makes Binance Smart Chain a formidable competitor to the Ethereum Blockchain.
However, Binance Smart Chain is a different network from Binance Chain. Binance Chain still struggles with flexibility in integration with different applications. In order to solve this problem, Binance Smart Chain was created, which can support The Ethereum Virtual Machine (EVM), a program for writing Ethereum smart contracts.
Binance Smart Chain uses a dual-chain architecture, which allows users to transfer assets from Binance Smart Chain to Binance Chain. The benefit is that users can use coins on dApps or Smart Contracts on the Binance Smart Chain and transfer them to directly Binance Chain for quick trading.