The history of binance coin is closely linked to that of the exchange site of the same name. In fact, the BNB token provides many advantages to its holders when they use this trading platform.
Binance is now a well-known exchange in the crypto world, so it will be interesting to discover how the platform managed to establish itself over the years within the community, and how it became one of the most reputable and most appreciated platforms out there.
The history of binance coin dates back to 2017, when the company decided to use an ICO to raise funds to finance its development. This took place from 26th June to 3rd July, with the sale of 100 million tokens, or 50% of the total supply. The price was 1 ETH for 2,700 BNB or 1 BTC for 20,000 BNB, placing its price at about 11 US cents at the time.
When it was released, BNB was an ERC-20 token, that is, a token using the Ethereum blockchain. However, the exchange eventually created their own blockchain, the Binance Chain.
The Binance platform was released at a truly opportune time, that is, during the cryptocurrency boom of summer 2017, which continued until the end of the same year. At that time, user demand for digital assets was huge and all exchange sites were taken by storm.
This allowed Binance to be able to carve out a juicy slice of the pie, which might not have been the case if market conditions had been different, as users would likely have continued to trade on their usual platforms rather than trying to experiment on a new exchange.
However, investors very quickly noticed that Binance was a nice, ergonomic platform, visually pleasing, easy to use, with very low trading fees (0.1% per transaction). In addition, owning BNB tokens further reduces these transaction costs, which has placed the company in a strong position compared to its competitors.
BNB has a big advantage, that of being able to reduce Binance transaction fees for its holders. This is probably what allowed the token to quickly gain popularity and gain so much value.
The token arrived on the market on the 25th July 2017 at around 11 cents, but was quickly trading above a dollar from 14th August, and exceeded $10 on 27th December. The unit value of a single BNB did a 100x in less than five months. Two weeks later, there was a peak of almost $25 on 12 January 2018.
The token price then stabilised for many months to peak at almost $40 on 28th June 2019, eventually breaking above $50 on 2nd February 2021 and $100 on 9th February.
Initially, the reduction in transaction fees provided by BNB was planned as follows:
Nonetheless, Binance decided to reverse this decision and announced that the fee reduction would be 25% for an indefinite period, which allowed the token to keep its strong utility.
After developing its own blockchain, the Binance Chain, the company decided to launch its own Decentralised Exchange (DEX) on 23rd April 2019, referred to simply as Binance DEX.
While most of the other DEXs use the Ethereum blockchain and require ETH to trade, on Binance DEX, users must use BNB to carry out transactions, which once again enhances the utility of the token.
Unfortunately, until the beginning of 2021, Binance DEX was not really used by the crypto community, as some users did not appreciate the overly-centralised nature of this exchange. However, due to the explosion in transaction fees of the Ethereum network in January 2021, Binance’s decentralised exchange has been starting to gain some popularity, which has been felt on the price of the BNB token through an explosion in price over the course of the year.
Every three months, Binance has committed to use 25% of its profits to buy back BNB tokens at market price and burn them, that is to say destroy them in order to reduce the total supply available. As a result, the scarcity of BNB increases, which allows its price to appreciate.
Here is a summary of the different burn operations that have already taken place on the platform:
|# Burn||Date||BNB burned||% supply||Value (Million USD)||BNB price (USD)|
The platform is committed to burning tokens until the total supply reaches 100 million tokens, or half of the initial maximum supply. Currently (February 2021), just under 30% of the tokens have been burned by the platform, which still leaves room for many burns in the future.
Binance has a rich history and it is arguably the best exchange out there at the moment. It has succeeded in quickly establishing itself among crypto fans thanks to the utility offered by its BNB token and by the outstanding governance of the company.
In view of the development of the cryptocurrency industry and the ever increasing popularity of Binance, we can be sure that the platform will continue to grow richer and that the management team will continue to innovate in order to constantly offer new features for crypto traders.
If you would like to learn more about BNB, we have created several different guides on binance coin. Do not hesitate to consult our dedicated page in order to learn precise information on different aspects of the project.
Président et Cofondateur de MinedHack et fervent défenseur de la Blockchain depuis 2017, je suis conscient que sans explications et vision de l’industrie son adoption n’aura jamais lieu. J’ose espérer en tant que Reporter et Rédacteur de CoinTribune aider à cette mission.
The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.
|BITCOIN (BTCUSD) ₿||$54,881.18||2.03%|
|ETHEREUM (ETHUSD) Ξ||$4,139.64||2.32%|
|IMM. US (REIT)||$2,733.76||-2.78%|
Receive the latest and best crypto news directly to your inbox