Binance Coin (BNB) Cryptocurrency: Current Price and How It Works
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BNB, formerly known as Binance Coin, is a digital asset that powers the Binance ecosystem, which includes the world’s largest cryptocurrency exchange and its related blockchains.
BNB, which stands for “Build and Build,” is one of the five largest cryptocurrencies by market capitalization and has a limited supply of 200 million tokens.
The utility token was launched in July 2017, alongside the Binance exchange, through an initial coin offering. Half of the supply — 100 million tokens — was made available to outside investors through the ICO at around 11 cents per token, while 20 million were allocated to angel investors and 80 million to the founding team.
Initially, users received discounted trading fees on the Binance platform when paying with BNB, but the token has since grown to also become a payment method on a small number of additional platforms.
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BNB price today
Although BNB is one of the largest cryptocurrencies by market capitalization, its value can be subject to high volatility, similar to others in its asset class. That means the price of BNB today may not be a good indicator of what it will be tomorrow. The chart below shows BNB’s current price and historic BNB price data.
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What to know about BNB
BNB was initially released as an ERC-20 token on the Ethereum network, before later migrating to different protocols on the BNB Chain, which includes the Binance Chain and Binance Smart Chain (now the BNB Beacon Chain and BNB Smart Chain, respectively).
Binance’s quarterly burning program
BNB is a deflationary cryptocurrency, meaning that its supply will decrease over time. Binance does this through its “burning” program, which permanently removes a certain number of BNB tokens from circulation each quarter. It has committed to burning BNB until it has destroyed half of the total supply, or 100 million tokens.
Users can burn tokens by transferring them to a crypto wallet that no one has access to anymore. Burning cryptocurrencies can drive up the price of a token, since the supply is reduced.
The number of BNB tokens that Binance burns changes each quarter and is calculated by its Auto-Burn formula. In April, Binance said it burned 1.84 million tokens in the first quarter of 2022. According to crypto data provider CoinGecko, roughly 163.3 million tokens are in circulation as of June 2022.
BNB use cases
BNB is primarily used within the Binance ecosystem, although it can also be used to make a variety of other purchases.
Holders of BNB receive discounts on trading fees when they use BNB to pay on the Binance exchange. The tokens can also be used to pay for transaction fees on the BNB Beacon Chain and BNB Smart Chain.
You can use BNB to make purchases with a small number of merchants that accept Binance Pay or another crypto payment processor. For example, you can use BNB to book travel accommodations through Travala, subscribe to BitTorrent, purchase a subscription to PureVPN or buy an HTC smartphone.
Other use cases include taking out a loan with ETHLend or Nexo, making donations through Binance Charity and investing in new tokens through Binance Launchpad.
BNB can also be used for crypto staking, which lets you earn passive income on your holdings.
Regulatory concerns with Binance
Binance has faced growing regulatory scrutiny across the globe, and various government agencies have accused it of operating without permission in their countries. In order to comply with U.S. regulations, Binance banned U.S. users from its platform in 2019 and partnered with BAM Trading Services to create the Binance.us exchange. However, Binance.us accounts remain unavailable to residents of Hawaii, New York, Texas and Vermont.
Like the Binance exchange, Binance.us offers a discount on trading fees when paying with BNB, but the number of available cryptocurrencies on the California-headquartered exchange is much smaller than the number on Binance itself.