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What Is the Binance Coin (BNB) & How to Trade It?

Date Modified: 18/02/2024

Binance stands as one of the most renowned names in the Cryptocurrency field, recognized among the largest Cryptocurrency exchanges globally.

Its colossal presence significantly influences the Crypto landscape. As a result, numerous traders and investors are keen on delving into the intricacies of its native Cryptocurrency, the Binance Coin (BNB).

As of December 2023, the BNB coin boasts an impressive market value exceeding $38 billion, underlining its substantial impact on the ever-evolving Cryptocurrency market.

So what is the Binance Coin (BNB) exactly, and why should it interest you?
Here’s what you need to know:

An illustration of the Binance (BNB) coin.

TL;DR

  • BNB is the native Cryptocurrency of Binance, a major global Cryptocurrency exchange.
  • BNB was originally based on the Ethereum platform.
  • BNB’s ICO took place in 2017.
  • BNB can be used to conduct online payments, donations, and purchases.

What Is Binance?

To understand the Binance Coin (BNB) it is essential to understand what Binance is. Binance is an online Cryptocurrency exchange that was founded in 2017. Interestingly, Binance operates globally as Binance and in the US under “Binance US.”

Binance specializes in a diverse array of services, prominently altcoin trading and Crypto-to-Crypto transactions and the platform is known for equipping traders with a Crypto wallet for the storage of their digital assets.

Additionally, the platform caters to Crypto miners with dedicated programs among other services.

Binance Coin (BNB) ICO

An Initial Coin Offering (ICO) marks the pivotal moment when a cryptocurrency is introduced to public trading, serving as a means of fundraising activities related to the digital asset.

Binance BNB Coin’s ICO, was initiated on June 26, 2017 and finalized on July 3, 2017. The ICO raised a whopping $15 million through offering 100 million BNB tokens to traders. Furthermore, the capital raised was mostly spent on marketing initiatives.

What Is the Binance Coin (BNB)?

The Binance Coin (BNB) is a Cryptocurrency that serves as the primary Cryptocurrency for the Binance exchange.

It originated on the Ethereum blockchain before evolving into Binance's native coin and initially, in 2017, it served as a utility token made for discounted trading fees.

Utility tokens are Cryptos that allow access to certain services and functions on a blockchain. This usually means that they enable their users access to advantages like reduced fees or other benefits.

Later on, the Binance Coin’s functions were expanded, and it can nowadays be used for various purposes beyond its original intent.

What Can the Binance Coin (BNB) Be Used For?

Despite initially serving as a utility token, the Binance (BNB) coin can serve to conduct online transactions, such as:

  • Online purchases
  • Travel payments
  • Process payments
  • Make loans
  • Make transactions
  • Donate to charities

The Pros and Cons of the BNB Coin

Benefits of BNB

Those who use BNB may enjoy the following perks:

  • Reduced transaction costs
  • Faster transaction processing times
  • Cross-platform uses (it can be used on multiple platforms)

Binance Coin Burning

In addition to the abovementioned perks, it may be worth keeping in mind the fact that similar to Bitcoin Halving events, Binance conducts BNB coin burns, which refer to the quarterly events that permanently reduce the circulating supply of BNB coins, hence raising their value for the holders.

Disadvantages of BNB

Some of the BNB Coin’s drawbacks include the following:

  • BNB Coin, like many other Cryptocurrencies, is considered volatile.
  • It can experience regulatory limitations that can affect its prices.
  • Heavily dependent on the Binance exchange. As such, any good or bad developments within the Binance exchange can affect the BNB Coin’s price.

How to Trade the Binance Coin (BNB)

There are numerous ways to trade Binance Coin (BNB). One way to do it is through purchasing the Binance Coin (BNB) directly through exchanges.

This means you'll become the owner of the Cryptocurrency, and you'll need to store it in Crypto wallets.

Another way to potentially capitalize on BNB price movements is by trading Binance Coin (BNB) CFD with Plus500.

BNB CFDs allow you to gain exposure in both rising and falling BNB prices without the need to own the Cryptocurrency or store it in a wallet.

Moreover, Crypto CFDs are leveraged, meaning that your losses or gains can be multiplied based on your position and market prices.

For a more in-depth understanding of CFD trading, you can watch our informative Trader’s Guide video titled “What Is CFD Trading?”

Conclusion

In conclusion, Binance Coin (BNB) exemplifies Binance's substantial influence on the Cryptocurrency world. Since its ICO in 2017, BNB has surged to a value exceeding $38 billion by December 14, 2023, and its purposes have expanded across various domains.

FAQs:

What is the BNB Coin?

BNB or the Binance Coin is the native Cryptocurrency of the Binance Crypto Exchange.

When was the BNB ICO?

The BNB ICO was initiated on June 26, 2017 and finalized on July 3, 2017.

How can Binance Coin (BNB) be utilized?

BNB can be used to conduct online transactions, purchases, payments, and loans, and donations among other things.

How is BNB related to Ethereum?

The BNB Coin is originally based on the Ethereum blockchain and later became the native Cryptocurrency of the Binance Exchange.

How can I buy the BNB Coin?

You can buy the BNB coin directly from a Cryptocurrency exchange or you can trade BNB CFDs with Plus500 and trade on rising and falling BNB prices without having ownership of the Cryptocurrency.

Other Helpful Resources

Here are some resources that could help you understand Cryptocurrency CFDs better:


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