As one of the top cryptocurrency exchanges, it’s often hard to believe that Binance is also a relative newcomer to the scene. Their dedication to user experience and customer service allowed them to carve out a major slice of the exchange market, and they have not slowed down since. While they continue to introduce new features, they are also keeping an eye on the value of their proprietary cryptocurrency – Binance Coin.
Binance Coin (BNB) Burn
Binance Coin (BNB) exists for two purposes. First, it represents an investment in the Binance platform. In this sense, it’s like a share of stock or a security token. The value is generally related to the perceived success of the exchange. Second, it serves as an instrument for transaction fees. Users can choose to pay their transaction fees using BNB rather than the currency in question and receive a discount on the fee as a result.
As outlined in their whitepaper, the cryptocurrency exchange also intends to perform regular coin buy backs using their exchange profits. The process of buying back coins causes an increase in per unit price, simply through the regular mechanism of asset trading. Burning coins then decreases the overall supply, which also increases the value. The most recent burn just occurred, with Binance burning 2.2 million BNB – the equivalent of $30 million USD.
Dispelling Fiat Pairings Rumor
Recent industry rumors have suggested that Binance may soon be offering fiat pairings for some of their more popular offerings. Binance’s CEO Changeng Zhao went to social media to announce that this was not the case, saying;
“While we can’t predict the future, others keep attempting it on us. Both “news” are not accurate. We are working with banks (to potentially support fiat), but no plans for USD in the short term. No xvg or xpr involved. Be careful around predictive “crystal ball” news.”
While this news is certainly disappointing in the short term, Binance’s continued willingness to clearly state their intentions and their plans is encouraging. Particularly when compared with others in the cryptocurrency industry, Binance has been very open – they were quick to comment during a recent downtime and kept all their customers updated throughout the course of the crash.
Dust to BNB Announcement
The most recent feature announcement is an expansion of Binance’s ‘Dust-To-BNB’ feature. Although they had previously offered a limited ability to trade ‘Dust’, this expansion greatly increases the size and scope of the program. Due to the fractionalized nature of cryptocurrency trading, users are often left with fractions of various coins that are too small for trading. This ‘Dust’ often accumulated over time, leaving users with a considerable amount of unusable funds.
Through the mechanics of the exchange itself, Binance offers users the ability to sell this Dust off for their own currency, BNB. As the combined value of the dust is often enough to trade, there is no requirement to maintain those funds in BNB. However, as there is a discounted fee incentive, it often makes sense to keep that BNB for future transactions.
Article By: Adam Stone