When people buy and sell cryptocurrencies on an exchange, speed is key. The value of currency fluctuates so quickly that any long delays can be costly. That’s where Binance shines.
What is Binance?
Binance is a popular cryptocurrency exchange that launched in 2017. Its explosive growth is attributed to the combination of low trading fees and fast transactions. Binance also has its own token, Binance Coin (BNB). The name Binance is a mashup of the words ‘binary’ and ‘finance’.
Who created Binance?
Changpeng Zhao and He-Yi co-founded Binance in 2017. Zhao is the current CEO and appeared on the cover of Forbes just a few short months after Binance was launched. After emigrating to Canada from China in the 1980’s, he put his computer science degree to use for the Tokyo Stock Exchange and Bloomberg. Then he went on to work for crypto companies like Blockchain.info and OKCoin before co-founding Binance.
Did you know?
CEO and co-founder Changpeng Zhao has a tattoo of the Binance logo on his forearm, which he says is a sign of his commitment.
A brief history
- July 2017 – ICO raises $15 million
- March 2018 – Announces relocation to Malta
- July 2018 – Acquires Trust Wallet – a mobile crypto wallet
What’s so special about it?
⚡️ Fast – Binance claims to process 1.4 million orders per second.
🤝 Low fees – It charges 0.1% in transaction fees, and even less if you pay in Binance Coin.
💧 Liquidity – The high volume of people buying and selling on the exchange means it’s easy to sell at close to market price.
📊 Choice – Binance offers hundreds of different cryptocurrencies.
How is Binance Coin produced?
Binance Coin (BNB) is an ERC-20 token built on Ethereum. Binance issued 20 million Binance Coins at its ICO, and will eventually buy back half of them and destroy them. This ‘burning’ process helps maintain the token’s value. Binance Coin can be bought on the Binance exchange using another cryptocurrency, or it can be bought on several other exchanges.
How does Binance Coin work?
Binance Coin can be bought or sold on Binance’s own exchange, or a handful of other exchanges that offer it.
What can you do with Binance Coin?
Binance Coin can be used to pay trading fees on the Binance exchange. For example, if you trade another cryptocurrency for bitcoin on the exchange, Binance will charge you a 0.1% trading fee. That’s how the company makes money. However, if you use Binance Coin to pay the fee, they will reward you by charging a lower fee. That has helped increase demand for the exchange’s own currency. Binance Coin can also be used to buy other cryptocurrencies on the exchange. Additionally, some real-world retailers accept it – including all stores at Brisbane Airport in Australia.
Binance has a lot of plans for the future.
Blockchain – Binance announced it will be launching its own public blockchain in 2019. Dubbed the ‘Binance Chain’, it will be a platform for people to create new cryptocurrencies.
Fiat to crypto – Binance is largely known as a crypto to crypto exchange. That means that you can’t trade fiat money (like the US Dollar) on the platform for cryptocurrencies. You first need to use another platform like Coinbase that specialises in fiat to crypto exchange, then bring that cryptocurrency to Binance. By avoiding fiat, Binance has also been able to avoid a lot of the government regulation that comes with it.
Now the company has big plans to launch fiat to crypto exchanges on every continent, starting with Uganda. The hope is to lure more traditional institutions to invest on the platform by making it easier to jump in. However, it looks like the US Dollar isn’t part of the plan anytime soon. The CEO said in an interview with Fortune that it doesn’t want to deal with country’s tight regulations.