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Binance coin (BNB) is one of the safest holds out there and here is why

Felix Küster Felix Küster
June 9, 2018
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binance coin

One of the main advantages Binance fitted into their own token is the token burning process which almost guarantees a gain in price with the decrease of token supply. Burning dates are not fixed, they are loosely set but the exact date is only known couple of hours before the burn. They’ve been making enough profit to burn about 2m BNB each quarter.

In July the trading fee with BNB discount will increase from 0.050% to 0.075%. All else being equal, this will increase Binance’s profit, increasing the buy pressure on BNB from the buy & burn program.

Binance also plans to reduce trading fee discount from 50% to 0 in 5 years. By the time the discount ends, BNB will be integrated in Binance’s decentralized exchange.

At the current burn rate, it will take much longer than 5 years to buyback & burn 100m BNB too. Even after the discount ends, there will probably still be buy pressure from Binance using 20% of their profit to buy & burn BNB.

From trading and investment perspective, buying BNB makes sense:

  1. You pay 50% less on your trading fees
  2. You can easily sweep dust and turn it into BNB
  3. BNB token price will appreciate as more users join Binance and their volume increases.
  4. You can use BNB if you wan’t to participate in ICOs on Binance
  5. Quarterly BNB burn which reduces the total BNB suply.
  6. Once Binance adds new features like margin trading, we might see BNB play a role in that further increasing the utility of the token.

BNB should be the kind of coin that continues to rise with time rather than having large jumps on burn announcements because of that. As people trade, the coin goes out of circulation and into Binance’s wallet where they eventually burn it.

This coin is surely one of the safer holds in many people’s portfolios. If you believe in Binance, which is currently the fastest growing exchange that will soon offer fiat pairs as well, the demand for BNB is going to continue to go up while the supply is going to start dropping fast as they burn from their profits. As long as Binance exchange is around and popular, their will be demand for their currency as a trading platform.

 

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Felix Küster
Felix Küster

Felix Kuester works as an analyst and content manager for Captainaltcoin and specializes in chart analysis and blockchain technology. He is also actively involved in the crypto community - both online as a central contact in the Facebook and Telegram channel of Captainaltcoin and offline as an interviewer he always maintains an ongoing interaction with startups, developers and visionaries. The physicist has couple of years of professional experience as project manager and technological consultant. Felix has for many years been enthusiastic not only about the technological dimension of crypto currencies, but also about the socio-economic vision behind them.

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