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Author: Admin | 2025-04-27
Binance coin (BNB) is the native cryptocurrency of the BNB Chain, Binance’s blockchain. But what does BNB do, and what role does it play within the Binance ecosystem? This article offers a beginner’s guide to BNB Chain, exploring its features, purpose, and more. KEY TAKEAWAYS➤ BNB is a crypto that can be used to trade and pay fees on the Binance centralized exchange.➤ The crypto allows users to benefit from reduced transaction fees when trading on Binance.➤ While the asset’s ties to the largest crypto exchange by market cap ensure its enduring functionality and utility, this intrinsic connection also presents a risk — if Binance runs into trouble, it’s likely BNB does too. What is BNB?In 2017, Binance introduced the BNB crypto to the market. BNB functions as a key utility coin within the Binance ecosystem. Its primary use is to cover exchange transaction fees and enable participation in crypto sales and various other exchange features. BNB ranks among the top five cryptocurrencies in market capitalization — sitting below tether but above XRP. The abbreviation “Build N’ Build” symbolizes the network’s evolving commitment to collaboration, participation, and open-source development.History of BNBBinance coin (BNB) emerged in July 2017 as part of Binance’s mission to revolutionize digital asset trading. The coin initially raised $15 million through an Initial Coin Offering (ICO). “An ICO is a valuable tool if you use it correctly. We didn’t plan all of it. This is our first and only ICO. We learned and adjusted our strategy along the way. We were able to execute quickly every time we made an adjustment. We got lucky in a lot of places. We also stepped on a few mines, luckily nothing too major.”Changpeng Zhao: LinkedIn During the ICO, 100 million tokens were sold at an initial price of $0.11 each, representing 50% of the total supply.How does BNB work?Initially, Binance launched BNB as an ERC-20 token on the Ethereum blockchain. However, it has since migrated to the main BNB Chain, which comprises two interconnected blockchains:BNB Beacon Chain: This segment of the network manages governance activities, including staking and voting on proposed network modifications. Previously, this was called the Binance Chain. It’s a consensus layer compatible with the Ethereum Virtual Machine and has multi-chain hubs.BNB Smart Chain: Handling the creation and execution of smart contracts, BNB Smart Chain was previously called the Binance Smart Chain. Over time, BNB expanded its role beyond fee payments. Binance introduced the Binance Launchpad in 2018, allowing users to participate in new token sales with BNB, driving up demand and value. BNB holders can: Save 25% on spot trading feesSave 25% on margin trading feesSave 10% on futures trading feesIn 2019, Binance launched its blockchain, Binance
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