Binance Coin – What is it, definition and concept

Binance Coin (BNB) is the cryptocurrency traded by the Binance cryptocurrency exchange, and whose acronym comes from the words “binary” and “finance.”

The Binance platform manages more than 100 digital assets and is the largest in the world by trade volume. Its blockchain (Binance Chain) was launched in February 2019 as a decentralized alternative market.

Origin of Binance Coin

Changpeng Zhao, with varied experience in trading and digital currencies, was the founder of the company.

Initially, Binance was based in China, but moved to Japan, coinciding with the Chinese government’s ban on trading cryptocurrencies.

They both launched Binance Coin, Binance’s cryptocurrency. In a short time it was positioned as one of the ten most valued by its users. In addition, in relation to the capitalization of these currencies in the markets, it is ranked 28.

Differences between Binance Coin and Bitcoin

Let’s see some differences with the most popular cryptocurrency, Bitcoin:

  1. Binance Coin has 200 million units issued and the goal is to reduce it to 100. Meanwhile, bitcoin is limited to 21 million.
  2. Bitcoin is based on a proof-of-work consensus and this cryptocurrency on an authorized proof-of-stake.
  3. The use of Bitcoin is free and no additional information is required to operate with it. However, the Binance cryptocurrency requires an identity verification.
  4. It cannot be mined, unlike others such as Bitcoin, since this process was previously carried out by the Binance platform.
  5. It has open-source software made up of a cluster system.

Data of interest

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We are going to see some of the characteristics of Binance Coin and its blockchain.

  • It is probably one of the fastest cryptocurrencies in its transactions. For example, Litecoin can process a few per second, but this cryptocurrency can process millions.
  • One of its problems is exclusivity. This currency is traded on Binance and, therefore, all profits are given on this platform.
  • In addition, within its own blockchain, the commissions are among the lowest in the market. This promotes trading by facilitating exchanges.
  • On the other hand, its currency (BNB) is admitted in many businesses to be able to acquire goods or services.
  • They offer a 25% discount when exchanging BNB for other cryptocurrencies.
  • Binance Coin has two levels of security. On the one hand, a cluster system and on the other, the SAFU, which is a fund of safe assets for users.

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