eToro, a global trading and investment platform, published a market research report on Binance Coin (BNB), Binance’s native token. BNB was conceived as the built-in currency for use in the Binance cryptocurrency exchange.
Of the thousands of ICOs witnessed in 2017, BNB was one of the most successful by far. Not only did Binace manage to successfully execute this new type of crypto financing, but they went on to use the funds raised to build an extremely successful crypto exchange. This is a prime example of new age token economics at work.” writes eToro Senior Market Analyst Mati Greenspan
Crypto-asset type: Utility Token (May contain elements of a Security Token)
Max. Supply: 190,799,315 BNB
Current Circulating Supply: 130,799,315 BNB
Token Economics: Defationary asset – The circulating supply of BNB actually decreases, since Binance has promised to perform recurrent token burns of the currency.
Protocol: Ethereum (ERC20)
Key takeaways from the BNB report and token analysis include:
- Binance’s top-notch team features CEO Changpeng Zhao, an influential figures in the crypto space who quickly built Binance into one of the most important alt-coin exchanges in the world in just a few months.
- The token’s main goal is to allow users to pay for trading fees on the platform. Paying these fees with BNB instead of any other cryptocurrency entitles a discount.
- The discount was of 50% during the first year operations and has now been reduced to 25%. The discount will decrease to 12.5% and 6.25% during the third and fourth years of operations, respectively, and will disappear after that.
- BNB is increasingly being used for actual payments for goods and services. Given its scarcity and that it is based on the Ethereum network, the intrinsic value of BNB allows for it to be used as a medium of exchange in normal transactions.
- The evolution of Binance over the last few months has been incredible, with several million active users and expected profits of up to $1 billion in 2018
- The growth in barely a year to become the largest cryptocurrency exchange in the world is simply unprecedented.
- Binance is working on a native blockchain called Binance Chain to handle all its operations. When the blockchain is ready, BNB will become a native coin on the Binance Chain instead of an Ethereum-based ERC20 token.
The full Binance Coin report also includes a technical description and outlines investment risks.