As of June 2021, Binance was dubbed the largest cryptocurrency exchange globally, supporting more than 1.4 million transactions per second. You can think of Binance the same way you would think of the Johannesburg Stock Exchange (JSE) or New York Stock Exchange (NYSE). The platform allows crypto investors to buy and sell hundreds of different crypto assets.

Binance Coin (BNB) has consistently remained one of the most popular crypto assets - having a return of over +1,500% since its launch in 2017. One can't help but ask, what makes it unique?

So what is Binance Coin (BNB)?

BNB is the native cryptocurrency of the Binance network and was created as a utility token for the Binance exchange. 

In a nutshell, a utility token is a token that cannot be considered money but instead gives users access to products and services on that specific platform. In Binance’s case, utility can be found in the form of reduced trading fees, early access to new Binance projects, beneficial loan terms and much more.

BNB’s utility in action

When a trade is made on Binance, it charges a 0.1% trading fee. The fee can be paid out of the cryptocurrency being traded, or users can choose to pay it with Binance Coin. When paid with BNB, a basic 25% discount is applied. Furthermore, the more BNB you hold, the larger the discount received on your trading fees.

More than a utility token - BNB is Binance fuel

BNB also powers the Binance Smart Chain (BSC). Much like Ethereum, the BSC is a programmable blockchain that can run smart contracts. Similar to using Ethereum to pay fees when interacting with Ethereum protocols, users will need to use BNB to interact with the BSC and all the applications built on top of it. That means developers can use it in many different ways, including creating decentralised apps (dApps), minting and selling non-fungible tokens (NFTs), and building blockchain games.

How has this helped the performance of Binance Coin?

To answer this question, we need to rewind to 2021. During this period, the largest smart contract blockchain, Ethereum, was dealing with heavy network congestion. The congestion resulted in slow transactions and expensive ‘gas fees’ (transaction fees). In stepped the Binance Smart Chain - an Ethereum competitor with lower transaction fees and a much faster transaction speed. While Ethereum has remained popular, many developers and users have switched to the Binance Smart Chain over the years. This rise in adoption increased the demand for the BNB token, since it's needed to interact with the BSC (classic demand vs supply scenario).

The proof is in the numbers

Despite the short history of comparison, the demand for BNB remains high amongst the top smart contract platforms, edging out its closest competitors. DOT (+66%), ADA (+269%), ETH (+311%) and SOL (+1 075%) have all underperformed when compared against BNB (+1 251%).

If you are still wondering why to invest, let's recap some features of BNB

Perhaps, first and foremost, BNB provides exposure to the world's largest crypto exchange as well as the second largest smart contract cryptocurrency. 

As stated above, the Binance Smart Chain offers faster transaction times, lower fees and a programming capability that makes it easy for developers to create complex smart contracts. This has resulted in developers consistently migrating to Binance Smart Chain, making it one of the most popular platforms for development.

Considering the size of the Binance exchange and the widespread adoption of BNB, this coin will likely rival the most popular crypto assets in the market for years to come.

Altify offers investors the ability to seamlessly gain access to BNB through the Altify Top 10 Bundle, Smart Contract Bundle or as a single asset (BNB).