What is Binance (BNB) in a Nutshell [DEL]

What's up everyone and welcome back to Box Mining. Today I'm going to take a look at Binance in a nutshell. I'm going to take you through the current working exchange, talk about its strategy and what it's going to do in the future. Then I'm going to talk about the Binance coin as well. It's currently trading at $2.37, getting a lot of traction recently. I'm going to talk about use cases for the coin and how it's going to be valuable in the future. This has been a highly requested topic, but I want to say that this is my current personal opinion and not financial advice. So let's take a look at Binance first of all. So Binance is a cryptocurrency exchange. It's both in English and Chinese. Predominantly it's going to be for the Chinese market, but it's going to have English as well, possibly Korean in the future. So it's going to support multiple languages to allow for international users to come on the exchange. Binance is a combination of two words, binary and finance Binance. And why it's binary is, is because it's doing only in currency pairs. So digital asset to digital asset, it's not going to deal with fiat. This allows the exchanges sidestep issues with dealing with the Chinese government. So you're not allowed to use the renminbi on or the US dollar on this exchange. Quite a hot topic in China. We see quite a few exchanges wanting to do digital asset exchanges. So Binance right now is working in English. English is surprisingly good and you can actually go in. So let's take a look at what's inside the exchange. So right now it's currently dealing in around 10 different tokens or coins right now. It has some tokens, for example, quantum, its own token, its own token and open angs. It's also got some coins. You got Ethereum on there and NIO and NIO gas. Right now at its current rate, it's actually trading with a trade volume of around 4 million USD a day. This is quite, quite, quite high because it only just recently launched. So it recently added NIO on the 11th of August and it actually has a huge trade volume for NIO. So for example, if you look at NIO in terms of trade volumes, you can actually see Binance up there right after Bittrex. So right now it's taking up 23% of the trade volume for NIO just almost two weeks after it added NIO onto the exchange. For these exchanges to work and do well, you need a huge trade volume. Its potential currently is based on its business strategy and its overall competency. So in terms of volume, it can handle around 1.4 million orders per second. So that's kind of the main selling point of Binance. It's a high performance trade platform. In terms of what its trading and its advertising, it's doing quite a lot to advertise itself. And that's one of the ways why it's getting so many people on the platform. Another thing that it's doing is it's doing zero trade fees until around the 24th of August. So right now the trades are free on Binance and it's a way to pull users onto the platform. Eventually what they're going to do is you're going to have a 0.1% fee, trading fee for all transactions on Binance. That's actually quite a bit lower than Bittrex. For example, Bittrex has a fee of 0.25% commission. But of course, one thing about exchanges is that safety is one thing and having a good team is one thing, but proving itself over the long term is yet another. So currently it's a new exchange and it's still going to be has yet to prove itself. One of the strategies that's in China using is that it's listing up more rare coins that are very popular in China. So instead of just going for your traditional Manero, your Dash, your other top 10 cryptocurrencies, it's listing more rare coins such as OpenAnx. And that way it can pull other users over to start trading on this platform because you have access to more rare coins. And we see that as a strategy for a lot of other crypto exchanges, for example, Cryptopia or Ether Delta, where they're listing different coins. More importantly, it has an ICO session, just like kind of hit BTC. So you have ICOs being listed on this exchange. We've seen ICOs are very huge in China right now. So we have two, one is one called Tron, one is called LLT. So having ICO projects listed on here means they can a generate revenue because they charge for listing these coins. And also they can pull people over because they probably would offer more exclusivity for these coins and be one of the top exchanges for these new coins. So they're definitely not trying to target classic top 10 cryptocurrencies right now because other exchanges will have more volume, but they're targeting newer coins and also Chinese coins as well. One thing of interest is what is going to happen to trade volume once there are fees because right now they have free of fees. But once fees are actually implemented on a platform, will they still have a high platform and will they still support this insane growth rate is another issue. We've seen competition with other cryptocurrency exchanges. For example, the BTCC DAX is also going to face competition from international exchanges as well because now that you're trading, it also faces quite a lot of competition from international exchanges too. Because right now with cryptocurrencies, it's quite easy to move crypto out of China and start trading between various coins. That said, of course, China does have a great firewall. So it's unknown how much of that connection will get kind of disrupted by the great firewall. If you're trading and your connection suddenly gets disconnected by the great firewall, then it's potentially quite devastating because now that trade will go through because your order hasn't been sent. So that's probably one of the reasons why the Chinese prefer a Chinese exchange instead. So let's talk a little bit about the Binance coin and what it does. So Binance coin, the first use case would be as a discount for the currency exchange. So right now, if you actually go to your account section on Binance, you can actually use BNB on your account for fees. It gives you a 50% discount on your fees and it'll be burnt once it's used. In terms of discount rate, it's going to have diminishing returns. So that's why they're probably trying to encourage you to burn them now. So after the fifth year, there'll be no discount on trade trades using BNB. So Binance coin can just use purely to give you a discount for fees. So you can pay half your fees with the Binance coin. In addition to that, Binance is offering a coin buyback. So they have a buyback schedule of around 20% of their profits every quarter. They're going to buy back until 50% of BNB tokens are bought back. They're going to buy these tokens back and then burn them and destroy them, leaving only 100 million left in the pool. The reason why they're leaving a million here is because they're also going to build a decentralized exchange. So right now, this is a centralized exchange. They keep your cryptocurrencies, but they're trying to build a decentralized exchange as well. So in the future, BNB tokens will be used on that decentralized exchange as gas and for reducing costs for transactions. So it's clear that they have a business plan and they have a use case for BNB. We definitely see the exchange already being built and trade going on there. 4 million is quite a bit actually, but it's definitely nowhere near the levels of Bittrex and the international exchanges. So it's going to be quite exciting to see how much trade volume they can get and how much attention they can get in China. Right now, it's doing quite a lot of advertising and bringing quite a lot of different ICOs in, but of course, that strategy is pretty standard in this market. So it's yet to see how long in terms of long-term growth it can sustain this growth and keep on trading, especially after the coin, after fees have been implemented. So guys, what do you guys think of Binance? Have you guys started using Binance yet? Are you interested in trying out Binance? Leave a comment below. I would love to hear what you guys think and what you guys think about the token as well. Guys, thank you so much for watching this episode. Remember to subscribe for more videos like this. See you next time.