The Long-Term Bullish Case for Binance Coin (BNB)

https://hacked.com/the-long-term-bullish-case-for-binance-coin-bnb-2/

Binance Coin (BNB/BTC) is one of the few altcoins that are melting people’s faces and leaving many in disbelief. The coin is up by over 100% year-to-date, and it is looking to print a fresh all-time high. From a technical perspective, the market is on a strong bull run with more room to grow.

However, is this run supported by strong fundamentals or is Binance Coin just another pump and dump scheme? To answer this question, we conducted an in-depth research on the altcoin. We looked at Binance Coin’s current state and what it could be in the future. We discovered its tremendous potential that can be realized with the right man at the helm of the project.

In this article, we present the long-term bullish case for Binance Coin.

Create Demand

Before we discuss what Binance Coin can be, let’s look at what it is.

The coin is the brainchild of Changpeng Zhao, the CEO and founder of Binance; the world’s largest cryptocurrency trading exchange by volume. Unlike Bitcoin or Cardano, Binance Coin is not a revolutionary payment system nor a platform for decentralized applications. In a nutshell, the altcoin is a discount token for users of Binance.

Users can purchase Binance Coin and use it to pay for fees when transacting in Binance including trading, listing, withdrawing and so on. Those who pay in Binance Coin receive considerable discounts. Refer to the table below for more details on discounted rates:

Year 1st 2nd 3rd 4th 5th
Discount Rates 50% 25% 12.5% 6.75% 0%

Source: CoinSwitch

If you’re not using Binance Coin, each trade carries a transaction fee of 0.1%. With the discounted rates using BNB, your savings can accumulate both in terms of trading frequency and volume. This makes BNB very attractive to market makers, active traders, and even investors.

With this strategy, Changpeng Zhao leverages his exchange to create demand for Binance Coin. As of December 2018, Binance has 313,000 daily active users and an average daily trading volume of $664.4 million.

Top spot trading exchanges by volume

Source: AmbCrypto

While we don’t know exactly how many traders pay transaction fees in BNB, the fact that the exchange has over 300,000 daily active users partially explains why Binance Coin has been on a surge. If there’s demand for the exchange, there’s a demand for its coin.

Reduce Supply

Changpeng Zhao fuels demand for BNB further by burning coins every quarter. The supply reduction measure helps ensure that the trend of BNB remains healthy for the long-term.

The incineration of Binance Coins will continue until 100,000,000 Binance Coins are burned. That number represents 50% of the total Binance Coins ever issued, which was 200,000,000. So far, almost 11 million BNB have been incinerated.

Quarterly coin burns

Source: Binance

Creating demand while reducing supply is a powerful one-two punch that can help keep the market bullish. However, is this enough to push Binance Coin to greater heights in the coming years? Changpeng Zhao knows it is not, which is why he and his team are working hard to build their decentralized crypto exchange.

Corner the Market

One of the biggest obstacles of mass crypto adoption is safety. For an average Joe to trade crypto, he must follow these steps:

  1. Signup and login to an exchange
  2. Send crypto to an exchange
  3. Trade crypto
  4. Withdraw crypto to a wallet

Somewhere between steps two and four, your assets are vulnerable due to the nature of centralized exchanges. Someone can hack the system to steal your coins. In 2018 alone, almost $1 billion have been stolen in crypto hacks. If your coins are stolen, it is very unlikely that you’ll recover them.

On top of that, users have to worry about shutdowns (such as the famous Mt.Gox improsion) and other issues such as the sudden death (recent case of the Quadriga exchange CEO) of an exchange’s CEO. There are so many factors threatening a person’s holdings in an exchange. Crypto enthusiasts are aware of these risks, but they tolerate the risks because an attractive alternative does not exist…yet.

Binance Decentralize Exchange (DEX)

Enter Binance Decentralize Exchange (DEX). This is Chanpeng Zhao’s trump card to corner the crypto exchange market. With Binance DEX, users can trade directly from their wallet or hardware device. The transaction is powered by the Binance blockchain and it happens between two users instantaneously and without an intermediary.

Here’s a quick video on how Binance DEX looks like:

In other words, you are in total control of your funds. You don’t even have to create an account in an exchange to trade. Also, after the trade, there’s no need to withdraw your funds because the coins go straight to your wallet. Even stock exchanges that have existed for hundreds of years do not offer these benefits.

The ability of users to secure and control funds by using Binance DEX make BNB a very strong long-term play. With a virtually unhackable platform, traders and investors from other spot trading exchanges are very likely to switch to Binance DEX. In addition, the platform is also likely to attract no-coiners who have been deterred to invest in crypto due to safety concerns or poor user experience.

The influx of users in Binance DEX will drive demand for Binance Coin. That’s because BNB will be used as gas. This means that people who want to trade using Binance DEX will have to secure some amount of BNB to pay for transaction fees.

Changpeng Zhao announcing BNB will serve as gas for Binance DEX

This is how Changpeng Zhao plans to corner the crypto exchange market. Unless other spot trading exchanges can innovate faster and better, BNB is very likely to remain long-term bullish.

Bottom Line

Binance Coin did not make it to the top 10 largest cryptocurrency by market capitalization by accident. Changpeng Zhao created an ecosystem where he leveraged his powerful exchange to instigate demand. He then introduced scarcity to keep the price of BNB stable until Binance DEX becomes available to the public. At that point, demand for BNB will likely be insatiable.

Create demand, reduce supply, and corner the market. This is our long-term bullish case for Binance Coin.

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Emailed the author of the article:

"Kiril can you please update the Binance trading fees in your Hacked article (https://hacked.com/the-long-term-bullish-case-for-binance-coin-bnb-2/)

The fee structure you quoted from the Coinswitch article (https://coinswitch.co/info/binance-coin/what-is-binance-coin) is out of date.

Latest fee structure is available at https://www.binance.com/en/fee/schedule

Please let me know when your article has been updated."

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Even tho Binance was mired in controversy, i wish i had gone hard on their BNB crypto at least to turn into BTC when it peaked.

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I’m looking forward to seeing what he says.

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Yeah…im watching this too.
It gets into an ethics thing…i love binance, but if they are shady…theres definitely an internal and integrity gut check.

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Bottom Line

"Binance Coin did not make it to the top 10 largest cryptocurrency by market capitalization by accident. Changpeng Zhao created an ecosystem where he leveraged his powerful exchange to instigate demand. He then introduced scarcity to keep the price of BNB stable until Binance DEX becomes available to the public. At that point, demand for BNB will likely be insatiable.

Create demand, reduce supply, and corner the market. This is our long-term bullish case for Binance Coin."

I volunteer to be the BNB DCA investor this year. Started with $250 worth.

Considering EOS,ADA,ICX or LTC as my other DCA.

Only a few cryptocurrencies have managed to escape bitcoin’s gravitational pull. These coins (Binance Coin, EOS, Tezos, etc.) have also been among the top performers this year. Read more: Ethereum, EOS, Litecoin, Bitcoin Cash: Major Cryptocurrencies are Escaping Bitcoin’s Sphere of Influence.

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hey pub friends! what are your thoughts on BNB future price after the recent binance hacking?

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It’s going to hurt short term. Long term it will do fine.

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I find it somewhat unsettling how BNB is going so hard like this pricewise.
Dont trust it…its weird because i really like binance.

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The launch pad projects are heavily back by VC’s the market buys into them blindly and it’s all done in bnb, this will inflate it and give it longer time support as long as they find new backed projects.
Punters are now hoarding on speculation.
Out with the stable coins in with binance coin seems to be the trend!

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binance its coin and new icos are all a scam

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As much as I love Binance for it’s ease of use and plethora of Alts to choose from, their practices are really concerning. I’m doing my best to go elsewhere now.

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You don’t actually listen to the ramblings of this drug addict do you? Everyone knows that Chico is entertainment only much like flat Earth videos and the moon landing was a hoax “documentaries”.

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Binance Coin (BNB) Maintains Bullish Bias in the Era of IEOs

Binance Coin (BNB) advanced on Thursday, once again becoming the growth leader in a market that has struggled to regain momentum following an early-week flash crash. While there was no immediate catalyst for the impressive price gain, BNB is benefiting from a virtuous news cycle tied to initial exchange offerings (IEOs), the launch of a decentralized exchange and the inclusion of a new margin trading service that is currently in beta mode.

BNB Price Update

The BNB price reached a high of $32.12 on Tuesday, according to CoinMarketCap. At last check, it was trading at $31.86, having gained 5.2%.

Unlike its large-cap peers, BNB has fulled retraced the sharp drop that began late Monday. The massive correction eroded more than $20 billion in crypto market capitalization. Read more here .

Week-over-week, BNB is down more than 6%. Its major peers have fallen between 9% and 20% over the same stretch.

At current values, Binance Coin has a total market value of just under $4.5 billion. Its well ahead of Bitcoin SV (BSV) but still more than $1.3 billion shy of EOS for sixth spot on the market-cap index.

Read more: The Long-Term Bullish Case for Binance Coin (BNB) .

What’s Stopping Binance Coin?

So, what’s stopping Binance Coin from bigger gains? At this stage, nothing.

The seventh-largest cryptocurrency has gained a staggering 72% over the past three weeks. That figure excludes the all-time high of $35.50 on May 30. At those levels, BNB’s market cap was worth roughly $5 billion.

As far as the large-caps go, BNB is the top-performing cryptocurrency of 2019, having gained more than 410% year-to-date.

BNB Price, YTD

Despite entering a sideways trading range toward the end of May, BNB is maintaining a bullish pennant pattern, which makes another parabolic move likely. As Hacked recently noted, another breakout of 90% or more is possible. That would give the BNB bulls an initial target of around $60 compared with the previous all-time high.

Hacked analyst Ken Chigbo says:

“All targets north of the all-time-high are the total unknown, but if the crucial current support areas continue to hold, then further moves north are likely.”

As far as fundamental development go, Binance recently launched a margin trading feature for several crypto pairs with USDT and BTC as the quote currency. The maximum leverage offered is 2x. Margin trading is a highly risky but enormously popular trading feature.

The growth of IEOs has also made Binance the go-to platform for investors looking to purchase vetted cryptocurrency projects. In order to participate in these keenly awaited IEOs, investors need to purchase BNB first.

IEO token sales are facilitated on Binance Launchpad. To date, the following sales have raised in excess of $37 million: BitTorrent, Matic Network, Celer Network and Fetch AI.

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I dont completely ignore him…look at the big picture tho. What he says i dont think is completely irrelevant.

I love binance, but im not going to be blind to possible corruption.
Theres PLENTY of that in the crypto space.

Overall…BNB does give me pause at times.

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