The idea of cryptocurrency exchange does not remain as a less explored one in the present world. Because of the high-flying profits and the ease of working, the prospects attract a lot of user interest. Meanwhile, the cryptocurrency exchanges use the services of safe digital platforms.
These exchange platforms facilitate the transactions and also the other trading features. The idea is to provide an integrated environment for digital gen users to conduct the tasks. The exchange platforms work in the secured and tight-end form of blockchain. This ensures the fact that every transaction and the simultaneous record is a part of the ledger. By doing so, the “near-perfect” security provides for a foolproof layout and also the exchange pattern.
The Origin Story and Existence of Binance
Launched in the year 2017, Binance is the leading platform that enables cryptocurrency exchange and other utilities. The services and tasks are conducted on the Binance blockchain and work in a decentralized form of existence. Moreover, the cryptocurrency exchange has the right ecosystem to enable various modes of processing.
These services include the listing of the cryptocurrency, the simultaneous exchange. And also the trading facilities. Within the first year of its large-scale existence, Binance also achieved the feat of being the largest cryptocurrency exchange by volume. Ever since millions of users trust the platform for its dedicated decentralized functioning too.
The Backdrop of the Origin:
The idea of cryptocurrency exchange is a tough and tedious one to deal with. However, Changpeng Zhao had his priorities cut out as well. Born in the backdrop of China during the 80s, Zhao also served as a software provider for the Tokyo Stock Exchange. Moreover, the further trade experience of the man took him to a Chinese-Canadian status of work.
Changpeng has the privilege of working with the explorer service of blockchain.com as the leading developer team member. His later ventures saw him moving under the shed of OKcoin before finally cementing the establishment of path-breaking Binance. A net worth of $1.4 Billion saw the man as one of the leading money-minters in the industry of cryptocurrency exchange.
The Revolutionary Introduction of the Binance Coin (BNB)
Trading under the trademark symbol of BNB, the Binance coin is a custom cryptocurrency coin denomination. The introduction of the Binance coin gave Binance exchange services a brand new ideology to facilitate its trading and exchange services. The Binance coin is also one of the biggest revolutions that created the right Launchpad for the Binance workability.
Binance exchange worked on the introduction of BNB at the setup of the initial coin offering. The process ensured the right chunk of the BNB going to the different parties. For example, the angel investors were provided with 40% of the total BNB floating. The introduction of the Binance coin intended to facilitate the services of:
- Cryptocurrency trading services through the payment of trading fees
- Cryptocurrency exchange through the exchange fees
- Listing Fees
- Other auxiliary fees for the services provided by the Binance exchange
Need for Introduction
While the use of cryptocurrency exchange is facilitating, it is also costly. The fees and the repeated transactions also incur expenses to add to the woes. However, the introduction of the Binance coin provides the user with an option to trade the coin for the payment of these fees. Moreover, the use of BNB on Binance exchange also laid out a systematic discount chronology for the service fee to the users:
- An exclusive discount of 50% within the first year from the date of the rollout.
- A subsequent reduction of the discount rate to half in the following year and also the year after.
This means a user of the Binance exchange can utilize the BNB to avail fee reductions and profits too. In addition to the usual service of exchange or service fee reduction, the BNB also has other features. The exchange takes place on a decentralized blockchain that ensures complete reliability for the security of the transactions.
Key Advantages and Market Involvement of the Binance Coin
In addition to the fee relaxation and payment ease for the exchange services on Binance, the BNB also serves other user interests. The outright support of the other cryptocurrency listing on the exchange also advocates for the use and reliability of the BNB. Moreover, the support gathered from the payment platforms also finds the BNB in a strong position in the market placement.
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The large scale involvement of Binance coins is also applicable for:
- Payment of hotel (collaborated) services and also other essential ones directly through the exchange
- Buying of other cryptocurrencies with the use of BNB
- Effective exchange of the BNB with its partners for the relevant services
- Provision of custom wallet for the users to indulge in the exchange
The currency value for the Binance coin remained largely positive through the year 2018. In addition, the rise was also strong through the turmoil of 2019. With an overall market cap standing at number 10 and the price of $17 and around that (at the time of writing), Binance coin holds a futuristic significance too.
Binance Chain and the Introduction of DEX
DEX, or also usually reminded as the Decentralized Exchange is the vision of Binance from the initial days. The Binance Chain also follows by the name of Binance DEX that involves the use of the decentralized principle. This includes the rational segregation of services like cryptocurrency exchange, issue, and also the cryptocurrency trading.
The key concept of the DEX is to revolutionize the method of blockchain existence. Because of its ability to distribute the nodes in the form of user devices all across the world, the task becomes easier. This means that the device in itself is the bearer of the user’s crypto funds and the transaction history. This remains on the blockchain as a permanent imprint too. The main idea is to lower the downtime of the server in comparison to the centralized systems. Additionally, the use of decentralized systems also ensures a high level of security to even organized attacks such as the DDoS.
The Binance exchange is not unaware of the challenges that it needs to face for the overall implementation. However, the idea is to learn through evolution and that also includes steady and phased implementation of the concept.
Limited Issuing and Coin Burning for the Binance Coin
Binance coin was launched with the idea of strictly limiting the extent of the issue. For example, the launch itself had the revealing of the BNB tokens up to a figure of 200 million. The angel investors got around a share of 80 million. Meanwhile, the other 100 million going to the core platform and the remaining 20 to the other important role players.
The idea of the limited issue was to understand the effective consequences of market exploitation and also limit them. By doing so, the Binance Coin is able to maintain a steady value with either a slow rise. However, there is very little or no chance for a fall of it too.
Binance coins are also purchased back by the platform under the plan for repurchase that got simultaneous inception too. Through this, the Binance exchange invests a share of around 20% of all the profits earned through the coin exchange.
While in the short term, the results of the buy-back might not be very evident. However, for a futuristic purpose, the repurchase enables in maintaining a sustained and steady value for the BNB coins that remain in circulation. By doing so, the company gives up on short-term goals and rather chooses long-term profitability.
The Future Evolution of the Binance Coin Role
The whole process of the Binance exchange works on a futuristic lookout. Right from outset, a policy of limited issue and phased burning also reflect the idea. Through this, the Binance coin looks to maintain a steady value for investors. By doing this, the firm encourages the users into holding the asset after a purchase.
The use of custom cryptocurrency wallets and other sources also encourages the whole philosophy. Fast and meaningful transactions with the decentralized chain also include a simple and effortless transition. Meanwhile, what the user gets is the power to use the tools for enhanced and rapid exchange and trading of the cryptocurrency. Moreover, the firm also intends to introduce the Binance coin in direct buying trade and hence raise its absolute value for the average user as well.
Originally published at https://cryptomagis.com.