What Is BNB (Binance Coin)?

BNB is the native coin of the Binance Chain ecosystem. If you buy it on the Binance exchange and use it there, you can get a 25% discount on trading fees. BNB (Binance Coin) was first launched on the Binance exchange in 2017.

What Is BNB (Binance Coin)?

BNB is the core token of the Binance ecosystem. BNB holders can use it for many purposes, including exchange fee discounts, the DeFi ecosystem, and participating in Launchpool and Launchpad.

BNB was sold through an initial coin offering (ICO) right before the Binance exchange launched. The ICO ran for one week, from June 26 to July 3, 2017. The initial price was 1 ETH = 2,700 BNB and 1 BTC = 20,000 BNB.

The total supply of BNB is 200 million coins, and 100 million BNB were sold through that ICO. In early 2021, the price of BNB rose sharply, drawing a lot of attention from both retail and institutional investors.

Who Created BNB?

BNB was created by Changpeng Zhao, the founder and CEO of the Binance exchange. After successfully closing the BNB sale, Changpeng Zhao officially launched Binance, which became the world's largest exchange. Behind the project there is also Yi He, a co-founder and Chief Marketing Officer. Yi He founded the Binance exchange together with Changpeng Zhao.

What Is BNB Used For?

BNB can be used in many ways across the BNB Chain ecosystem. Many people use BNB to pay trading fees. According to statistics, on the Binance trading platform alone, about 2 million users have paid a total of more than 40 million BNB in trading fees with BNB, across more than 127 billion trades.

When you trade crypto assets such as Bitcoin on the Binance exchange, each trade is charged a standard fee of 0.1% (trading fees are determined by your monthly trading volume and BNB holdings). If you pay with BNB, you can get a special discount.

So if you trade a lot on Binance, it's worth considering paying your fees with Binance Coin. Trading fee deductions follow a specific schedule, so please check the current spot trading fee schedule. It's also good to know that the Binance Futures platform follows a slightly different fee schedule.

Besides trading fee discounts, you can also use BNB on Binance DEX on the Binance Beacon Chain and in the many DeFi and decentralized applications running on Binance Smart Chain (BSC).

The BNB Burn Mechanism

BNB is designed so that its total supply keeps decreasing through regular burns. This deflationary mechanism can raise the value of BNB and create a deflationary effect.

BNB runs two coin burn mechanisms. The first automatically burns a portion of the tokens used as transaction fees on BNB Chain, and the second is the Binance exchange's quarterly BNB burn event.

The BNB Auto-Burn mechanism adjusts the amount of BNB to be burned based on the price of BNB and the number of blocks produced on BNB Smart Chain (BSC) during the quarter. BNB also uses a real-time burn mechanism based on gas fees. A fixed percentage of the gas fees paid is burned in each block, and that percentage is decided by BSC validators.

You can find more details about the BNB Auto-Burn at https://www.bnbburn.info/.

On top of that, the Binance exchange has been running a BNB burn program since late 2017. So far, more than 38 million tokens have been burned through quarterly burns. This will continue until up to 100 million BNB tokens, equal to 50% of BNB's initial supply, have been burned.

As of July 2022, Binance had completed 20 BNB coin burn events. A total of 38,683,447.66 BNB tokens have been burned, reducing the initial supply of 200 million by 19.34%.

How to Buy BNB

You can buy BNB on many different exchanges. The most widely used ones are Binance, Bybit, and OKX. If you don't have an account on one of these exchanges, you can sign up and then buy BNB.

BNB Coin and Its Chains

BNB was originally issued as an ERC-20 token on the Ethereum network. Later, when Binance Chain launched in April 2019, it was converted to BEP-2 BNB at a 1:1 ratio.

In September 2020, BNB Smart Chain, a blockchain network that runs in parallel with BNB Beacon Chain, was launched. Today, BNB can be used on three chains: Ethereum, Binance Chain, and Binance Smart Chain, as listed below.

• BNB Beacon Chain (formerly Binance Chain): BNB BEP-2.
• BNB Smart Chain (formerly Binance Smart Chain): BNB BEP-20
• Ethereum network: BNB ERC-20