Key facts about Binance Coin (BNB):
- Binance Coin was originally issued on the Ethereum blockchain in 2017.
- In April 2019, Binance launched Binance Chain and migratedBNB token to this new blockchain.
- BNB’s was originally launched as a utility token for paying trading fees on the Binance Exchange, a cryptocurrency trading platform
- BNB holders can participate in Launchpad events, where new cryptocurrencies are introduced on the Binance platform.
- Binance Coin is now accepted by many other exchanges and service providers, not just Binance itself.
- The highest price recorded for BNB so far was on the 10th of May 2021, at 686.31 US dollars per BNB.
About Binance Coin (BNB)
Launched in June 2017, Binance Coin (BNB) is the native token of the Binance Exchange. Users can pay transaction fees with BNB and trade the token on other exchanges. Binance Coin is limited to a total supply of 200 million tokens. Every three months, Binance destroys, or "burns", BNB tokens based on the trading volume achieved in that quarter, which reduces the supply. Binance operates a dual-chain system that can issue new tokens and support smart contracts for existing decentralised apps.
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What is Binance Coin (BNB)?
Binance Coin (BNB) is the native currency of the Binance cryptocurrency exchange used for the payment of various types of fees. Owners of BNB with Binance accounts have access to discounted fees at the exchange, which means that demand for the token is connected to the demand for the exchange's services. Therefore, buying BNB can be viewed as an investment in the success of the exchange, similar to buying a company share – with the difference being that ownership of a BNB token does not confer ownership rights in the exchange.
Originally, Binance Coin was designed as a utility token on the Ethereum blockchain. However, Binance Coin has now found broader use due to its popularity and the fact it’s being accepted by more and more service providers. For example, users can pay with the BNB on travel sites like TravelbyBit or online services like Canva. The token is also suitable for financial purposes as holders can use BNB to apply for a loan on ETHLend, for example.
How does the BNB cryptocurrency work?
The BNB Chain operates with a Proof of Stake Authority (PoSA) consensus mechanism. This means that the validators are limited to a small number of the largest stakeholders in the system on a given day (currently 21).
With the Proof of Stake mechanism of Ethereum 2.0, each participant only needs to stake 32 ETH, which means that a much larger number of stakeholders are involved in the validation process. The BNB Chain allows the system to be cheaper and faster than Ethereum, however, this comes with a greater level of centralisation.
An unusual feature of BNB is that users can sometimes reclaim lost tokens, albeit with restrictions. In some cases, users who lose tokens can report the incident and are compensated with new BNB.
Due to its Proof of Stake technology, you can also participate in the transaction validation of Binance Coin through Bitpanda Staking and be rewarded by the network. You can stake your coins and tokens with just one click and automatically receive weekly rewards.
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How many BNB tokens are there?
During the Initial Coin Offering (ICO, first issuance of BNB tokens), a total of 200 million BNB were issued. In quarterly burning events, Binance gradually burns tokens until only 100 million remain, in order to ensure a rise in the token's price. As the supply decreases, price increases are to be expected if demand also increases.
The original distribution of coins were as follows:
- 50 percent of the tokens were sold directly at the ICO
- 40 percent of the tokens went to the team, advisors, and investors
The remaining 10 percent were retained for the development of the company. The Initial Coin Offering took place on 21 June 2017, and the funds raised were used to further develop the exchange. Within a month, the company was able to generate 15 million US dollars. After the ICO was completed, Binance distributed the tokens to the participants and listed the BNB token on the platform.
What's special about Binance Coin (BNB)?
The token’s security, fast transactions, low transaction costs, and usability as a means of payment make Binance Coin (BNB) unique.
Crypto investors benefit from a 50 percent discount on trading fees with BNB. The cryptocurrency is also an interesting speculative object, as the BNB price has risen sharply since the ICO and remains volatile i.e.fluctuating in value. The regular burning events of the Binance exchange, where 20 percent of the profits are used to buy and destroy BNB, reduce the supply of coins and can positively affect the price of the BNB token.
Important facts about Binance Coin (BNB)
What you should know about Binance Coin (BNB):
- Binance is controlled by tech entrepreneur Changpeng Zhao, who is known in the crypto community as CZ’
- Binance's Chief Technology Officer, Roger Wang, previously worked at Nomura, Japan's largest investment bank, and Morgan Stanley – the rest of the management team has similar high-profile fintech experience
- Binance Coin plays a central role in the control and governance of the two Binance blockchains and is also important for trading on the platform.
- One of the key events in BNB's history was the move from the Ethereum blockchain to the Binance Smart Chain (BSC) in 2019, which was later integrated into the BNB Chain.
- Binance Coin is one of the four most successful cryptocurrencies by trading volume – only behind Bitcoin, Ethereum, and Tether.
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Price history of Binance Coin (BNB)
Since its2017 launch at a price of around $0.1 per token, the BNB price has risen in the long term. To promote the success of the cryptocurrency, Binance has introduced various features such as a decentralised exchange and credit services. Here, users receive discounts when they use BNB tokens.
BNB price: Milestones
We've summarised some of the most important milestones and events related to the BNB price for you:
- 2017: Binance Coin was launched at a price of $0.1 per BNB
- 2018: The BNB price reached an initial high of around $22 per BNB, but fell to below $5 per BNB over the course of the year
- 2019 and 2020: The price for BNB fell to below $10 per BNB after another high of around $38 per BNB during the pandemic year
- From July 2020 onwards: The BNB price rose and the price reached its all-time high of $686.31 per BNB
- Despite the impacts of the crypto crisis in 2022, the BNB price did not fall below $200 per BNB
- Since May 2022, BNB has been one of the four largest cryptocurrencies in the world by market capitalisation (currently at around $50.4 billion), behind Bitcoin, Ethereum, and Tether.
The development of the BNB price
In general, the BNB price has fluctuated in the past in a similar way to other cryptocurrencies traded on the market. The market cap of Binance Coin has grown over the years and was, at times, over $100 billion.
Since Binance's ICO, the price of BNB has risen significantly, reaching a price of more than $600 per BNB token at times.
BNB: Start in the crypto industry
The Binance ICO took place in July 2017 with an issue price of $0.1 per BNB. At this time, BNB was still an ERC-20 token – that is, a token on the Ethereum blockchain. In September of the same year, demand for BNB increased sharply following the opening of the Binance cryptocurrency exchange. The price exceeded one dollar for the first time, and investors who had invested during the ICO achieved a return of over 1,000% within four months.
The bull market & BNB price
In January 2018, due to the crypto boom, Binance was able to gain many new customers, which led to increased interest in Binance Coin. The price reached its first peak of just over $22. But in December 2018, with the decline of the crypto hype, there were large price losses in which BNB was also affected. Compared to the peak in January 2018, the coin lost more than 75% of its value by December 2018.
In April 2019, the Binance blockchain was introduced, and Binance Coin (BNB) moved from the Ethereum blockchain to the new blockchain. This led to increased demand for BNB and drove the price to over $30 in April and May 2019.
BNB during the pandemic
In March 2020, the Binance Coin price fell to just under $9 due to fears of Covid-19, following a previous positive development. However, by October 2020, the BNB price had recovered and once again reached values of over $30. Although at this time reports emerged that Binance was deliberately misleading regulators in the US, but this did not affect the BNB prices.
In February 2021, the BNB price benefited from the renewed crypto hype and reached values of over $100 for the first time. BNB then reached its all-time high to date of $686.31 in May 2021. In July 2021, BNB lost over 50% in value within two months due to crashes in the crypto market and ongoing investigations into Binance by US authorities. However, the Binance Coin price quickly recovered in November 2021, once again reaching a price above $600 per BNB.
Current price forecast of BNB
With the start of the bear market (a period of falling prices in the stock market) at the turn of the year 2022, the BNB price suffered heavy price losses. At the beginning of 2023, the Binance Coin price had a poor start due to the previous FTX scandal and rumours of lack of liquidity and transparency. Nonetheless, Binance Coin (BNB) remains one of the most successful cryptocurrencies.
What factors influence the BNB price?
The prices of cryptocurrencies like Binance Coin (BNB) can be influenced by various factors. These include general interest in cryptocurrencies, the introduction of new features and services, acceptance by traders and institutions, regulatory developments, supply and demand on crypto exchanges, as well as investor confidence in the project and the company behind it. It's important to note that the crypto market is volatile and unpredictable, so prices can fluctuate. Also, past performance is never an indicator of future price development.
Set coin quantity stabilises the price of the BNB token
The BNB price is influenced by many factors. Like all cryptocurrencies, its supply (i.e. the quantity of coins) was limited from the start. Therefore, inflationary actions, such as the excessive printing of money that would devalue the currency, are unlikely to occur. This created scarcity can lead to the price rising.
The Binance Coin (BNB) price also depends on supply and demand on crypto exchanges. If more people buy BNB than sell it, the price rises. Conversely, the price falls when more people sell than buy.
Government regulations for cryptocurrencies also apply to BNB
The BNB price, like other cryptocurrencies, are significantly influenced by government regulations. Tax policy, investment regulations, restrictions in the mining sector, government plans to introduce official digital currencies, and further developments can move the crypto market in different directions.
Partnerships and high-profile support for cryptocurrencies
Increasingly, well-known personalities have an influence on cryptocurrency prices. When a billionaire entrepreneur expresses his support for a certain coin or token in a tweet, the price often rises. More and more, celebrities are promoting cryptocurrencies and NFTs on social media, reaching millions of followers. The impact of these endorsements on crypto prices is enormous.