How to Use This Price Tracker
Cryptocurrency pricing data can help investors find opportunities in the market and make more informed investment decisions. NextAdvisor’s price tracker shows historical price, trading volume, market capitalization, and other important metrics for investors, especially those who are just starting to dip their toes into crypto investing.
While everyday investors probably don’t need every last bell and whistle to make informed investment decisions, there are some generally applicable key crypto metrics and indicators worth considering:
Crypto Indicators and Metrics for Beginner Investors
Price: As with any investment, price is where it starts and ends for investors. Pricing is highly volatile in cryptocurrency, but viewed over time can give investors an idea of how a given coin’s value has gone up (or down) over time.
Market Capitalization: In general, the higher the value of the market cap the safer the investment. Market cap is the total value of a cryptocurrency, and is calculated by multiplying the price of the cryptocurrency with the number of coins in circulation. The amount of tokens or coins circulating can be viewed as an indicator of a coin’s demand.
Volume: Higher volume typically means a given cryptocurrency has more market liquidity, meaning more ability for investors to sell an investment when they want to realize a profit. It represents how much crypto is bought and sold over a period of time, typically 24 hours.
About Binance Coin
Binance coin (BNB) is one of the most popular cryptocurrencies in the market, but you’ll have a hard time buying it in the United States, thanks in part to the fact that the company behind the coin has been caught up in a slew of regulatory problems.
“One of the issues with Binance is that you can’t get full functionality in the United States,” says Omar Qureshi, managing partner of High Tower Wealth Advisors. “They had to set up a separate exchange, Binance.US, and a separate U.S. version of the Binance coin.”
Binance.US is an American partner of Binance, the world’s largest cryptocurrency exchange by trading volume that was founded in 2017. The company created a U.S.-based version of its platform in 2019 to appease U.S. regulators unwilling to let American customers trade on Binance. The two exchanges operate as separate companies with Binance.US licensing software, trademarks, and wallet technology from Binance, a spokesperson previously told NextAdvisor.
However, both entities, well as Binance founder Changpeng Zhao, have continued to face regulatory scrutiny over the years. The latest is that the Securities and Exchange Commission is investigating the relationships between Binance.US and two firms owned by Zhao. The Justice Department and the IRS are also reportedly examining Binance’s role in money laundering and tax evasion. We’ve reached out to Binance.US repeatedly over the past year for comment on these regulatory issues, but did not receive responses.
“Lack of regulation can be a hindrance to the adoption of the token,” Qureshi says.
How Does Binance Coin Work?
Binance coin powers the Binance ecosystem, from its crypto exchanges to its blockchain project known as Binance Chain. Its crypto exchanges — including Binance and Binance.US — allow users to sell, buy, or trade cryptocurrencies, while Binance Chain allows developers to build financial, gaming, and metaverse apps.
Binance announced at the start of 2022 that the Binance Chain and Binance Smart Chain were uniting under a new name — BNB Chain — to reflect their connection with its native token. Here’s a quick overview of the two chains associated with the Binance blockchain:
- BNB Smart Chain: This chain is compatible with the Ethereum Virtual Machine, which is a way of bringing smart contracts to other blockchains. Additionally, it allows developers to build out different apps, from gaming to decentralized finance.
- BNB Beacon Chain: This chain overseas the governance of Binance, such as voting. In this chain, it’s also possible to hold the BNB coin and earn interest, otherwise known as staking.
What Gives Binance Coin Its Value?
Binance coin was primarily created as utility token that users could leverage for lower trading fees on its crypto exchange platform, but its uses have expanded since its inception in 2017, according to crypto expert and educator Wendy O. Users can also stake binance coin, pay transaction fees on the blockchain, use it to send or receive payments, or even purchase decentralized lottery tickets.
“It’s an exchange token you can use on the platform and you can hold it and earn a return,” O says. “On top of that, people can build projects on the Binance blockchain. The transactions are faster and cheaper than on some of the other blockchains.”
Another reason binance coin potentially maintains its value is due to its deflationary nature. Not only does Binance destroy, or “burn” a portion of the binance coins used to pay fees every quarter, but there’s a cap on the number of available tokens.
The latest burn happened in April 2022 when Binance burned a total of 1.8 billion binance coins, equivalent to more than $700,000 worth of tokens. According to Binance, the burns reflect the tokens’ usage and revenue generated on the exchange. By reducing the amount of binance coin tokens available in the market, it creates scarcity — one of the most significant factors that influence supply and demand. Scarcity plus demand means a higher price for investors.
“Binance seems to have built a good war chest and they’ve built out an entire ecosystem that developers are actually using, despite the fact it doesn’t really work in the U.S.,” O says.
How to Buy Binance Coin
The easiest way to buy Binance coin is to purchase it on a cryptocurrency exchange that offers it. It can be a little more difficult to buy BNB in the United States, although you can buy it on Binance.US, Crypto.com, and eToro. While Binance.US offers lower fees than other exchanges, it lacks transparency about security and has a history of regulatory issues in the U.S., which is why experts recommend sticking with more mainstream exchanges.
After you pick an exchange to buy binance coin, you’ll need to fund the account and place the order. This could include connecting a credit or debit card, or linking to your checking or savings account. As with any token, you may opt to store your coins in a cold or hot wallet. Experts recommend these wallets for binance coin investors: Exodus, Trezor Model T, and Ledger Nano X.
Before you invest in binance coin or any cryptocurrency, you should consider your investment strategy and portfolio goals. Many experts suggest limiting your total crypto investments to 5% of your portfolio in order to limit your exposure to this volatile new asset class. Before you invest money in a cryptocurrency, consider establishing an emergency fund, paying down any high-interest debt you have and setting aside money in a traditional tax-advantaged retirement account first.
Binance Coin Price History
Binance coin entered the market in 2017 at a price of nearly 11 cents, and doubled in price within a year.
By the beginning of 2021, binance coin had a price of nearly $40. Throughout 2021, binance coin soared in value along with a lot of other coins, reaching a high of just over $675 in May of that year. Within a few weeks, binance coin fell to about $354 by the end of May and fluctuated significantly in value for the remainder of 2021. By the beginning of 2022, binance was back below $500.
“Developers have been using the platform at an expanding rate,” Qureshi says. “This is an indication of the staying power of a coin over the long-term. However, binance coin was also subject to market movements that pushed prices higher in 2021. Now, Binance is dealing with the bear market.”
The price of binance coin has been on the decline since the start of the year amid a broader pullback from risky assets, largely due to surging inflation, a shaky stock market, and recession fears. More recently, binance coin has ranged between $185 and $310, an almost 70% swing.
Binance Coin vs. Ethereum
BNB chain and ethereum are two popular blockchains that let developers build apps and other software programs.
Binance coin is the native token of the Binance blockchain, while Ether is the native token that powers the ethereum blockchain. Both of these blockchains are designed with developers in mind. They are meant to facilitate payments, but they are also open to developers who want to create their own chains and applications.
One of the main differences is that Ethereum has smart contract capability, while Binance’s blockchain offers the Ethereum Virtual Machine and smart contract abilities without the network congestion. That means Binance’s blockchain allows for decentralized app development with larger capacity and faster speeds compared to ethereum.
“While it’s not considered an ethereum killer, I still think that Binance has its place and is likely to remain a blockchain player,” O says.
Binance coin originally launched using the ERC-20 standard, which is an ethereum-based token standard. It used a proof-of-stake method of verifying transactions, which involves computers being chosen to validate transactions. However, over time it migrated to a different proof-of-stake approach that uses open-source software known as Tendermint Core. It allows developers to write apps in any language, and can communicate with other blockchains. Ethereum is planning massive upgrade to transition from proof-of-work to proof-of-stake by the end of 2022.
Another key difference is that Binance is more centralized than ethereum. Even though Binance promotes itself to be community-driven and offers an open source decentralized public ledger, Qureshi points out that it’s still backed by a company.
“It’s a bit different in that it’s a centralized decentralized platform,” Qureshi says. “Binance is certainly more captive than a blockchain network like ethereum or bitcoin.”
Frequently Asked Questions
How much is Binance worth today?
Cryptocurrencies are volatile in price, and can experience massive price swings from one day to the next. Over the last few months, Binance has stayed in a range of $200 to $400.
What was binance coin’s starting price?
Binance coin’s starting price when it launched in 2017 was around 11 cents.
Is Binance safe to buy coins?
Binance has had regulatory issues around the world and isn’t available in all countries. There are also questions about the security of Binance.US, which is available in the United States. Consider using on a popular mainstream crypto exchange — such as Coinbase or Gemini — that has well-established regulation, as well as security measures, if you decide to buy crypto.
Be the first to comment