Binance coin, under the symbol “BNB,” has experienced quite a lot ever since it was launched by the cryptocurrency exchange Binance. Consequently, its primary investors have gone through a lot, from emotions to market moves. Some have quit their ventures, while others stuck with their investments and made profits when the BNB price rose, especially when it hit its ATH of $793.35. BNB was initially bought for $0.11, so clearly, an early investment in it would equate now to a fortune.

It’s one of the crypto industry’s most popular cryptocurrencies, with a market cap of around $92B by press time and a trading volume of $1.76B. It has a finite supply of 200MN units, meaning that when its network reaches this level, no more BNB coins can be minted and spread. Noteworthy, it secures the fifth spot in the top most popular cryptos, coming after heavyweights like Bitcoin and Ethereum. This can’t help but make many wonder what BNB can bring to the table. What is its worth, and what is it actually used for?

Investors want cryptos that win their trust

Many existing crypto investors, traders, or customers are in for the greater control the market offers over their financial freedom. Given today’s steep inflation and challenging financial landscape, wanting more autonomy over personal wealth is the money-wise thing to do. Nevertheless, cryptos are still in their developmental stages, and their underlying technology, blockchain, is constantly evolving. Digital coins that range from the lowest to the most known ones still struggle to find their footing among investor categories due to their overall newness. This is a reason why inquiries like “what is Binance Coin” arise.

A cryptocurrency’s value is impacted by its number of owners, as the confidence shown by crypto holders is a primary factor determining its success. If investors lose trust in a cryptocurrency, a consequential system failure can occur. One of the wisest ways to guarantee the audience’s confidence is to create a token or coin that serves more uses and less trouble—which is where Binance Coin steps in.

What is a Binance Coin?

Simply put, BNB is a digital currency launched by the online crypto exchange Binance. It was named the “Binance Coin” at first, which is why you may hear many people use this denomination when talking about BNB. Nevertheless, a slew of iterations resulted in changing the coin’s name to BNB. Essentially, they’re one and the same. The abbreviation emphasizes the developers’ fundamental philosophies, standing for “Build and Build.”

BNB fuels the whole ecosystem of the BNB Chain and can be bought, sold, or exchanged on the crypto exchange of choice. You can even use it to make purchases outside the trading ecosystem, namely in stores that take crypto for payments. From airline companies to restaurants and entertainment ventures, you can find quite a few businesses that are willing to offer their services and products for Binance Coin. Cryptocurrency is being more and more tolerated, though the region or state you live in makes the difference.

The origins

To start things off, BNB was launched as a token in 2017. A coin and a token, though used interchangeably, aren’t the same thing. Tokens are smaller cryptocurrency assets that are generally used for more specific and niche purposes compared to crypto coins. They’re dependent on a decentralized ledger, aka blockchain, to exist. On the other hand, coins don’t. Some of the hottest crypto coins include but aren’t limited to Bitcoin (BTC), Ethereum (ETH), Solana (SOL), Binance Coin (BNB), and the list continues. BNB was released during an ICO, short for Initial Coin Offering, organized to raise capital for the online crypto exchange Binance.

Binance Coin was developed and released on the Ethereum network, the most popular network for smart contracts and decentralized finance. Nevertheless, BNB became BNB Chain’s fundamental coin once the company made public its first blockchain ever.

BNB as an investment

Binance Coin can be treated as an investment in itself. The platform strives to improve its reach and decentralized network’s ability, so you can likely draw what crypto stands to benefit from it. Investors who pour money into crypto with a long-term approach prefer cryptocurrencies associated with successful companies, which is why you might consider stablecoins as an option for diversifying your portfolio. In the unpredictable, speculative, and ever-rising crypto market, portfolio diversification stands as a shrewd strategy to reduce potential losses. When an owned crypto’s value drops, chances are that you have another one to rely on to keep your portfolio’s value in check. That is when you’re in a bull market.

During bear markets, having investments unrelated to crypto might help balance your portfolio’s worth. But such achievements necessitate knowledge and education, which you should develop before jumping on crypto. This is the reason why we’re looking into Binance Coin now.

BNB isn’t an infinite source of units

Regarding BNB’s utility, a general rule that investors should keep in mind is that some have limited supplies—as is BNB. From its inception, an auto-burn apparatus integrated into BNB regulated coin launches periodically. Nevertheless, this isn’t a constant; rather, it is a strategy to limit inflation and ensure long-term value, among other things. The development follows Bitcoin’s model, which has a finite resource, too.

To put it simply, Binance Coin is a cryptocurrency inherent to the BNB Chain. Investors are drawn to the numerous advantages it possesses when used within the leading network. But since it has evolved so much, part of its appeal is also given by its potential as an investment to fight inflation’s devaluation. It’s also popular for its speculative nature, meaning that one can profit off of price changes considerably.

Conclusion

Provided that you can escape feelings like FOMO and FUD and stick to a well-done strategy, you can consider BNB for its potential benefits. You can invest in fiat or exchange it for other cryptocurrencies and stock your investments in a hot or cold wallet.