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  • Matteo Poole

Binance coin - BNB

Updated: Jun 21

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Binance coin market

What is Binance Coin (BNB) and how does it work?

Binance Coin (or BNB) is the token of one of the biggest global cryptocurrency exchanges: Binance. This exchange originally launched in 2017 and instantly gained popularity due to its low fees, cool interface and extravagant competition for traders on the platform. Its aim was to bring crypto trading to the forefront of financial activity globally, and it did so by stating its own ecosystem of services including the Binance Chain, Binance Smart Chain, Binance Academy, Trust Wallet and Research projects all powered by blockchain. BNB Coin is a key part of this whole ecosystem.

What makes Binance unique is that it has a whole ecosystem of decentralized, blockchain-based networks that have led it to become the most popular leading exchange by volume in several countries with their side organizations attracting massive amounts of interest too. Its continuous drive for development has made it so that the services provided span of different spheres, and the aim of the company has become to be the infrastructure services provider for the entire blockchain ecosystem.

Since launching its BNB token, the exchange has grown in popularity among investors, boosting the use of the platform even more. Due to a huge price increase in 2021, the Binance coin has been on the radar of many in the crypto community, as it grew to a top 5 coin by market capitalization. A strong and well-thought-out deflationary tokenomics, as well as network updates like BEP-95, have made this crypto even more deflationary and viable for several use cases. Following the BEP-95 proposal, modelled after Ethereum's famous EIP-1559, gas fees on Binance Smart Chain have become even lower, as the network burns a part of the fees to decentralize further.

This has already proved to be a helpful upgrade as it saw the exchange overcome several exploits of protocols on BSC, such as a $200M exploit of Pancake Bunny and several hacks of Cream Finance. Despite these hacks, users have stuck with the exchange due to its low fees and abundance of lucrative coins to trade.


Coin Analysis

Last update 9/6/2022

BNB coin was originally launched between the 26th of June and the 3rd of July 2017 through an Initial Coin Offering (or ICO), 11 days before the actual exchange opened for trading. During this token launch, the issue price of the Binance coin was 1 Ethereum for 2,700 BNB or 1 Bitcoin for 20,000 BNB. At the time Bitcoin was trading at around $2,700, making the launch price of BNB around $0.14.

Following the launch the whole crypto market was going through a bull run, with Bitcoin and Ethereum growing exponentially, so did BNB which saw its first run culminating in a new all-time high of over $20, marking an over 1500% growth from launch prices. This was followed by a long and extensive bear market that carried on until 2019, when BNB price once again exploded, reaching new ATH around $38. Once again this was followed by a correction until 2020 when the Binance coin really saw its biggest rally.

BNB/BUSD weekly candles chart
BNB/BUSD weekly candles chart

During the year the coin exponentially reached an all-time high of around $660, or over 1900% since the beginning of the year, marking one of the most successful projects of the year and catapulting the coin to be among the top most traded cryptocurrencies. Ever since the BNB has cooled down, dropping to around $290, before reaching its all-time high again and falling once more, a sign that would suggest a really likely double top and further retracement. Currently, the BNB price is still trading around the $290 support and is trying to form a bottom, but it's still unclear whether this is the case.

In the past few weeks on the weekly time frame, both the 20EMA and 50EMA levels have been lost, with the cryptocurrency trading at around its 100EMA. The next logical support to monitor is around the low $200s, but it's still unclear whether the coin is headed that way. Once the crypto regains some momentum and upwards push, we can expect a quick rally back towards all-time high levels.

BNB is available for trading on dApp.

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