What is Binance?

Do you know how to use digital currencies? Digital currencies can be traded only on specific platforms. One such platform is Binance.

Founded in 2017 by Changpeng Zhao, you can trade with digital currencies on the platform.

This trading platform has gained a lot of popularity. Mainly because of the added security and features it offers. In this tutorial, I will discuss what is binance and its features. Binance is a platform based on the blockchain. If you want to learn about it, check out the blockchain pre-requisites to get a brief idea about the technology.

Let’s explore the world of Binance cryptocurrency exchange together!

Overview of Binance?

Binance is the largest crypto exchange platform. You can trade with over 350 cryptocurrencies. Binance will allow you to purchase digital assets through various means.

Let me tell you a great feature of the platform. Binance provides market insights and research reports. This helps make informed decisions. It is a widely used platform.

Here I have listed some key features of this platform:

1. Spot trading: Binance offers spot trading. You can trade your digital assets at the current market price.

2. Savings: Binance also provides its users with saving opportunities. Binance has many savings products such as flexible and fixed-term savings accounts.

3. Binance card: Binance also provides a debit card! Yes, you heard me correct.

4. Binance Academy: Binance provides educational resources for you to learn about the platform and technology. One of the best ways to learn what is Binance.

Binance also has new security features. Two-factor authentication is the main one. You will also get an anti-fishing code. You can check the authentication of messages or emails from Binance.

This platform monitors your account. If any suspicious activity is detected, immediate action is taken. Binance is also ready for the worst-case scenario. If you lose your assets for a security breach, Binance has a fund to reimburse you. This is the secure asset fund for users (SAFU).

What Is a Crypto Exchange?

I mentioned that Binance is a cryptocurrency exchange. However, I did not stress what exactly such a platform does. Let me simplify it for you.

A crypto exchange is like a stock exchange. Here investors trade using digital currencies. A crypto exchange is like an e-brokerage. You can use it with desktop or mobile apps.

Binance crypto exchange offers various forms of trading like leading or margin trading, options trading, etc. However, it’s not free. These exchanges charge some type of fee for your transactions. The fee varies according to the volume or type of transactions.

What Is Binance Coin (BNB)?

It is the digital currency issued by Binance. It trades with the BNB symbol. Initially, BNB was based on the Ethereum network. Now it is a native Binance blockchain currency. In today’s world, the market value of BNB is $86.56B, ranking fourth on the list. Additionally, the Binance price is at $592 per BNB.

But, you should note that this is the Binance price today, it will change tomorrow again.

The BNB was created to boost the Binance exchange. Using BNB can help reduce exchange fees, trading fees, listing fees, etc. Any fee on the Binance Exchange.

Uses of BNB coins

BNB coins, just like other digital currencies can be used in many places apart from the Binance exchange. Some of these uses are as follows:

1. Credit card payments: You can use BNB coins to make credit card payments. However, not all platforms allow it, you can make the payments using crypto.com.

2. Trading: You can choose to trade your Binance coins for other cryptocurrencies. This will depend upon the restrictions set by the exchange.

3. Making travel arrangements: BNB coins are accepted by many websites for making travel arrangements. Book your flight tickets or hotel with BNB.

4. Loans and transfers: You can use BNB as collateral for loans. But only for some platforms. There are also some applications where you can use Binance coins to pay friends or split bills.

5. Transaction fees: BNB tokens can be used in the Binance exchange. You will also get a discount on your transactions.

6. Entertainment: You can use BNB to pay for your entertainment. Virtual gifts or lottery tickets are just some ways.

7. Investment: Using BNB you can invest in EFTs, stocks or other assets on many platforms.
   

Initial Coin Offering

BNB was launched with an initial coin offering (ICO). In the crypto industry, ICO is like an initial public offering. It is used for raising funds.

During the 2017 ICO, 200 million BNB tokens were distributed. Here I have shown a brief breakdown of how the BNB coins were initially distributed:

• Angel investors: 10% (20 million BNB)
• Public sale: 50% (100 million BNB)
• Founding team: 40% (80 million BNB)

The tokens for public sale were sold at 15 cents per token. Binance raised $15 million in Bitcoin and Ethereum.

What Are the Binance Charges?

The platform requires a certain amount of fees to use. Here I have listed the fees you have to pay to use the largest crypto exchange platform:

1. Margin Fee: If you choose to trade on margin, you might have to pay a fee. There might be an interest on the borrowed amount.

2. Exchange fee: Binance charges a fixed fee of 0.2% on each trade.

3. Withdrawal fee: You have to pay a fee when withdrawing funds. The cost can vary depending upon the cryptocurrency Binance.

4. Launchpad fees: If you are participating in token sales on the Launchpad, Binance will charge you a fee. This will depend on the number of tokens you bought.
   

What Is BNB Burning?

Every quarter, Binance uses 20% of its profits to repurchase and burn Binance coins. This destroys them completely. This will continue till they have repurchased 50% (100 million) of all the BNB back.

This is done to preserve the asset’s value and maintain its rarity. BNB uses an auto-burn mechanism. It adjusts the amount of BNB to be burned based on its price and the number of blocks generated during the quarter. This allows the BNB community to practice predictability and transparency.

Store Your BNB Tokens Using Binance Wallet

What is Binance account? Using your Binance account you can trade on the platform. But where do you store the funds? That is when you need a Binance wallet.

The Binance Web3 wallet is an integral part of Binance. It is an online wallet for your digital asset. Binance wallets are needed for decentralized finances (DeFi). It also allows you to access decentralized apps (DApps).

You can use this digital wallet to keep your holdings. Some key features of the Binance wallet are:

• Two-factor authorization: When using Binance, you will have to enable 2FA. This will help to keep your account and assets safe.

• Multiple currencies: Binance Web3 wallet will help you trade using various currencies. Litecoin, Bitcoin, and Ethereum are just some examples.

• Supports BSC: It supports Binance Smart Chain. BSC is a blockchain created by Binance. I will talk about it in the tutorial later.

• Withdrawal limits: It might sound like a disadvantage, however, it is done to keep your assets safe. It helps prevent fraudulent activity.

• Move your assets around easily: This Web3 wallet is integrated with Binance Exchange. You can easily move your funds between the trading account and your wallet.

The Binance wallet offers many features. But it is a custodial wallet. In such a digital wallet you will not have any control over your private keys. Your funds might be at risk. Understand what you're investing in.

What Is Binance Chain?

Binance chain is a Binance blockchain. It aims to provide a decentralized exchange (DEX) of funds.

DEX does not need you to pay any middlemen. Let’s say, you want to buy a new property. But you don't want to pay any middlemen. So what do you have to do? You directly have to buy from the builder.

This is exactly what decentralized exchange is. Binance lets you trade without any middlemen.

Understanding the difference between centralized and decentralized cryptocurrencies can be very helpful.

What Is Binance Smart Chain (BSC)?

BSC runs parallel with the native Binance Chain (BC). You get to experience the best of both worlds - the high transaction caption of BC and the smart contract functionality of BSC.

However, BSC is a standalone blockchain. What I mean by that is that even if the Binance Chain stops working, BSC will continue to operate.

Another added feature of BSC is that it is Ethereum-compatible. With this developers can create or migrate DApps, tools, and other ecosystem components without much friction.

What Is Binance Launchpad?

Binance Launchpad is a crowdfunding platform. It helps crypto startups to raise funds. The startups offer their token to Binance users. This is a widely used method for crypto startups to gather funds.

The Binance Launchpad is a great way for fundraising and associating investors with new blockchain companies. If you have a crypto-startup, Binance has resources that will help you learn how to launch and promote your tokens to get funds.

You can get your check on how much you earn on the Binance app.

What is Binance app?

Binance has a mobile application. You can use it to both make and check your transactions. It helps you keep track of all your assets. You can also check the trends in the market on it.

Final Words

Binance is an online exchange where you trade cryptocurrencies. It works for many commonly traded online currencies. Many investors have started their crypto journey from the platform.

However, there are certain risks when dealing with online exchange platforms such as Binance. Make sure you learn about the trade and the platform in detail before proceeding.

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FAQs

1. What is Binance and how it works?

Binance is a platform for trading digital currencies. It uses blockchain technology. You can trade using several digital currencies.

2. Is Binance legal in India?

Binance is not legal in India. The Indian government does not allow exchange platforms like Binance in the country.

3. Is it safe to use Binance?

Comparatively, Binance is a safer crypto exchange than the other ones available. But Binance has had some security breaches.

4. How to make money on Binance?

You can trade, that is buy or sell digital currencies to make a profit from the fluctuating Binance value. You can try skating to earn passive income using your assets.

5. Does Binance give real money?

You can make money from Binance. You can transfer the money to your bank account with fiat withdrawals.

6. Is Binance easy for beginners?

Binance provides resources for beginners to learn. However, the platform can sometimes be overwhelming for beginners and experienced since it does require skills to trade on.

7. Is Binance 100% safe?

Binance does have many security measures to keep your assets safe. However, it has experienced some security breaches in the past.