What is Binance Coin (BNB)

what is binance coin

Binance (BNB) – Definition

Binance coin was originally issued as an ERC-20 token that was held on the Ethereum network . However, in April 2019, when the Binance Chain mainnet was launchedBNB ERC-20 coins were exchanged for BEP2 BNB at a 1:1 ratio. BNB Coin can be used to make payments, as a utility token to pay fees on the Binance Exchange, and also to participate in token sales on the Binance Launchpad. BNB also powers Binance DEX (decentralized exchange).

Binance (BNB) – History

Binance Coin (BNB) is an ERC-20 type token that was created within the Ethereum blockchain and then released directly with the centralized exchange called Binance. In July 2017, a total of 200 million BNB Coin tokens were issued in an ICO to finance the development of the exchange. Subsequently, the coins were transferred to their own blockchain within the platform known as Binance. This cryptocurrency has a mechanism that gradually decreases the amount of BNB Coin in circulation. About 100 million BNB Coins (50% of the initial issue) are expected to be burned, which will lead to a regulation in the price of the coin.The idea is that in the long term the price stabilizes.

BNB – Economy

This cryptocurrency can be used both to transact within its own exchange (Binance), and to exchange it for other cryptocurrencies, both within its own exchange and on third-party exchanges.

How Binance works

This cryptocurrency was created with the intention of being able to carry out transactions within the same Binance exchange. The value of this and its capabilities have been increasing as the exchange has grown and the ecosystem has expanded. BNB Coin can be used on the blockchain, on third-party exchanges, to make payments, for different types of research and development projects, and for the Binance Smart Chain (BSC). Some of the features that BNB Coin has are:
-Fast transactions: this coin can support up to a total of 1.4 million transactions per second. -Security: Binance makes use of a system of clusters and levels that serve to safeguard user funds.Additionally, these funds are insured by a secure asset fund for users, also known as SAFU.-Discounts: When exchanging BNB Coin with any other cryptocurrency or token we will have a 25% discount. -Payments: Various companies around the world can accept BNB Coin as a means of payment for goods and services. 

Binances Wallet

A BNB Coin address is a unique form of identification for each user of the network, which fulfills the objective that we can carry out transactions (both sending and receiving) with cryptocurrencies easily and quickly. In the world of cryptocurrencies, addresses work the same as in the traditional financial system, both to send and receive money. This means that it works as a kind of bank account.

Binances transaction

A transaction made with BNB Coin is simply a transfer of value between two wallets that is recorded on the blockchain. In order for money to be sent from a wallet, the sender will first need to sign the transaction with his unique private key in order to prove that he owns the funds.

Mining BNB Coin Works

Unlike other cryptocurrencies like Bitcoin, BNB Coin cannot be mined as you would proof-of-work crypto, as the Binance blockchain uses the Byzantine Fault Tolerance (BFT) consensus mechanism. Instead, there are validators who win by securing the network through block validation.

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