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About BNB

What is Binance Coin (BNB)?

Binance Coin (BNB) is the native digital asset of the Binance ecosystem, including the exchange and the Binance Smart Chain (BSC). The BNB coin was initially launched as a utility token for use in the Binance crypto exchange but then evolved into a more versatile cryptocurrency.

The BNB was originally launched as an ERC-20 token on the Ethereum blockchain. It then migrated into the BSC, the cryptocurrency exchange’s own blockchain network. In addition to letting users pay discounted trading fees on the platform, the Binance Coin can also be used to pay transaction fees on the Binance Smart Chain as well as a payment method for purchasing goods and services online.

As of April 2022, the BNB token is the fourth largest cryptocurrency by market cap after BTC, ETH and USDT. Its utility and value have increased with the Binance ecosystem’s rising adoption among dApps, especially in the DeFi space.

Binance offers a 25% discount on trading fees for spot trading and margin trading if users pay using the BNB token. Users of the platform also enjoy a 10% discount on futures trading fees when transacting using BNB coins.

You can learn more about Binance Coin (BNB) at our KuCoin Blog.

How Does BNB Work?

BNB is a unique cryptocurrency with several uses, across the Binance exchange, the Binance Chain and the BSC. The Binance Smart Chain differs from the Binance Chain in that it supports smart contracts and can run decentralized applications on it.

On the other hand, the Binance Chain offers an optimal experience for trading on-chain and for operating the Binance DEX. However, it has limited functionality in comparison with the newer and more capable BSC.

Users get to pay transaction fees on both the Binance Chain and the Binance Smart Chain using the BNB token. In addition to paying discounted trading fees on the Binance cryptocurrency exchange, BNB holders receive other benefits within the exchange.

Its use within the DeFi ecosystem lets users invest in stocks and ETFs using BNB. It can also be pledged as collateral for loans users wish to take out on DeFi applications.

History of Binance Coin

Binance Coin’s launch took place in July 2017 via an initial coin offering (ICO). At the time, Binance had designed BNB as an ERC-20 token on the Ethereum network.

Binance had earmarked 100 million BNB tokens for the public sale during the ICO. The company managed to successfully raise $15 million in capital from this round in the form of BTC and ETH.

The total supply of BNB was set at 200 million at the beginning. Of these, 40% was allocated to the founding team of Binance.

20 million BNB or 10% of this share was set aside for angel investors. The remaining 50%, 100 million BNB, was offered for the public ICO sale event.

In 2019, Binance launched its own blockchain, the Binance Chain (BC). BNB then migrated to become BC’s native token. Binance then allowed users to perform a token swap to exchange their ERC-20 BNB tokens for the BC-based BNB coins.

How to Buy Binance Coin (BNB)

Binance Coin (BNB) can be bought via several leading crypto exchanges, DEXs, wallets, and crypto payment gateways. One of the most convenient ways to buy BNB is via KuCoin. Here are the steps for this:

1, Register an Account With KuCoin

If you are already a KuCoin user, sign up on our platform with your email and details. Make sure you complete your KYC verification after logging in for the first time. This will give you access to all our services and features.

2, Add Crypto to Your Trading Account

It’s time to fund your trading account with some cryptocurrency. Head to KuCoin’s Fast Trade to buy crypto with fiat currency via more than 70 payment methods. Choose from Visa, Mastercard, SEPA, PayPal, and more options.

You can also buy crypto via the KuCoin P2P service or through third-party sellers on the platform.

3, Buy BNB on KuCoin With Existing Crypto

You also have the option to transfer your existing cryptocurrency holdings into KuCoin and use it to buy BNB. Simply send your crypto from your external wallet into the KuCoin account to get started with this.

4, Trade BNB/USDT on KuCoin

Head to the KuCoin Spot Trading to start trading BNB/USDT crypto pair. Review the latest BNB price, market cap, 24 hour trading volume and other relevant data before entering a new trade.

Click on Buy and enter the number of USDT you wish to exchange for BNB. Check the number of BNB tokens you will receive and the trading fees before confirming your buy trade.

5, Store BNB Safely

A few minutes after the successful execution of your trade, you will receive the BNB coins you bought in your KuCoin trading account. You can choose to hold them here or transfer them to an external wallet for additional security.

FAQ

How to Use BNB

The Binance Coin has several uses, some of which are listed below:

➢ Get Discounts on Trading Fees on Binance

Pay fees on Binance exchange using BNB to get discounts, making it a cost effective way to transact for crypto trading on the exchange.

➢ Payment Method For Online Purchases of Goods and Services

You can use BNB to pay for buying goods and services online across several businesses that support it as a payment option. You can use BNB as a payment method via gateways, book hotels and airfare online, shop for games and pay for financial services.

➢ Pay Transaction Fees in Binance Chain and Binance Smart Chain

BNB serves as the native token within both BC and BSC blockchains. You can pay for transactions on these networks with the help of Binance Coins.

➢ Trade BNB Crypto

Trade the BNB cryptocurrency against fiat currencies, other cryptocurrencies and stablecoins to generate profits and grow your crypto portfolio. Ensure that you review the BNB price, market cap, trading volume and price action and perform careful analysis before placing trades in Binance Coin.

➢ Earn Passive Income With BNB

You can stake BNB or lend them on DeFi apps and other platforms to generate interest on your holdings in Binance Coin. You can use KuCoin’s crypto lending option to add liquidity in the platform using your BNB tokens over a period of 7 days, 14 days or 28 days to earn attractive APRs.

How Long Does it Take to Mine 1 Binance Coin?

It is not possible to mine Binance Coin (BNB) since all the tokens have already been pre-mined at the time of launch. In addition, BNB employs a deflationary mechanism of using token burn to reduce the circulating supply of the crypto, sending the Binance Coin price and market cap upwards.

You can, however, earn BNB via staking. Check out the next section to learn more about how to stake Binance Coin.

How to Stake BNB Coin

You can stake BNB in multiple ways - directly on Binance, via crypto wallets, DeFi apps and more. You can also earn attractive interest on your BNB holdings on KuCoin via our Crypto Lending feature.

Head to the Lend BNB page and enter the amount of BNB you wish to lend. Select the number of days you wish to lend your BNB coins for - choose from 7 days, 14 days and 8 days.

Review the daily interest rate on offer. This number changes dynamically based on demand and trading volume on the KuCoin platform. You will get to see an estimated profit after entering all details.

Why Does Binance Burn BNB?

Binance has employed an Auto-Burn system to bring down the total supply of BNB from 200 million at the time of launch to 100 million. This mechanism automatically adjusts the number of BNB tokens to be burned at each cycle based on the BNB price and the number of blocks generated on BSC over a period of three months.

The process of burning or destroying tokens creates a deflationary effect in the market, reducing the circulating supply of Binance Coin and driving the BNB price and market cap higher, as a result. This in turn helps support the BNB value in the market.

In addition to the Auto-Burn, there is also a real-time burning mechanism in place. This depends on the gas fees on the Binance Smart Chain. BSC validators decide on the ratio of BNB collected as gas fees which get burned when each new block is added to the blockchain.