Some people find such a predicament in order to trade their cryptocurrency into various cryptocurrencies such as Bitcoin, Litecoin, NEO, Cardona etc. So, here a cryptocurrency exchange company Binance established a smooth and reliable platform that aids in trading a cryptocurrency into various cryptocurrencies.
Binance was founded by a Chinese-Canadian business executive Changpeng Zhao in 2017. The main purpose of building Binance is to enhance high-frequency trading software. The company holds more than 500 cryptocurrencies trading software and virtual tokens for instance- Ether, Dogecoin, Cardona, Litecoin etc.
Moreover, Binance tolerates exchanging its own Blockchain-based cryptocurrency Binance Coin BNB. Binance provides various services to its users like helping out in making investment decisions, transfer of electronic funds and eligibility to earn interest.
Where does Binance operate?
As of now, Binance is currently functioning in more than 180 countries except the United States of America, Italy and the United Kingdom. In the past two years, Binance has been struggling with multiple warnings from various governments regarding its spurious and counterfeit activities in the name of global trading of cryptocurrency.
Financial Conduct Authority banned the world’s biggest crypto exchange company Binance from conducting illegal ‘regulatory activity’ in U.K. as the company didn’t register with the FCA in order to operate their services in the country.
Main Product and services of Binance
Binance helps in trading, listing, de-listing, fundraising and withdrawal of international cryptocurrencies. Besides, the company also provides services in exchanging its own cryptocurrencies with enormous benefits through initial coin offerings.
Binance allows the trading process with the support of these seven types of trade orders- Limit Order, Market, Trailing stop order, LLimit TP/SL Order (Strategy Order), Stop market order and Stop-limit orders. People can exchange their cryptocurrencies with these trade orders.
Other than the exchange of cryptocurrencies, Binance also generates users to earn interest by funding Stablecoins in the market for an exchange. Besides, interest is estimated on the coin’s tenure, value in the market, interest rates available on such coins.
Binance bestows Visa Card which is a credit card that accesses users to convert their cryptocurrency into fiat current and can spend that liquidity money on products.
Target Audience of Binance
Binance highly targets those investors who are ready to fund a hefty amount of cryptocurrency in the market for the exchange of high-frequency cryptocurrency.
Business Model of Binance
Binance, being the largest and most famous cryptocurrency exchange in the world with its own two forms of cryptocurrencies, has a business model that makes the company a highly profitable enterprise.
The company earns its profit by trading fees, fees from its broker program, interest on loans, stock token spreads, mining services, interchange fees, cloud offerings and profits from investment.
One major source of income for Binance is by charging brokerage fees in Binance Coins (BNB) for every transaction that takes place on the exchanging platform. It also makes capital gains on the coin investments and thus makes the BNB coin price rise.
What is unique about the Business model of Binance
Binance charges a fee for trading cryptocurrency. When a user buys or sells a cryptocurrency, generally Binance charges a 0.1 per cent fee for the trade. But the charge can differ according to the currency and type of exchange.
In 2018, Binance began investing in other cryptocurrencies and it also distributed ledger technology projects. The company can earn when the investments are sold at a profit and the incoming dividends also serve as a source of income.
In 2020, Binance introduced two mining pools for mining bitcoin and Ethereum. Bitcoin users are charged 2.5 per cent and Ethereum users are charged 0.5 per cent pool fees by Binance.
Users of Binance can buy stock tokens from April 2021. Stock tokens are similar to real stock and the value of the underlying shares determine the value of the token. Binance earns through spread from the difference between the buying and selling price even though a fee isn’t charged for buying and selling of tokens.
In July 2020, Binance in partnership with Visa launched a Visa debit card. Users need to transfer funds from their cryptocurrency wallet to the spot wallet. Binance charges an Interchange fee when the debit card is used for making a purchase. The fee is paid by the merchant and is less than 1 per cent. Binance also charges a fee for ATM withdrawals and payments up to 0.9 per cent.
Interest On Loans
Binance allows its users to take cryptocurrency loans for a period of 7-180 days by pledging their crypto holdings as collateral. Binance earns by way of Interest on these loans and the interest is calculated based on the amount taken as loan, the time period and the collateral.
Binance Cloud platform allows users to launch digital asset exchanges using their software-as-a-service capabilities. Binance offers other services apart from spot trading like peer-to-peer fiat exchange, etc. Binance charges an annual fee on their cloud products and splits the trading commission with the investors.
Cryptocurrencies are gaining popularity in the present and have become a popular form of investment among many due to their changing value and the transactions being secure while paying using cryptocurrencies online are some of the many factors for the popularity of cryptocurrencies.
Changpeng Zhao has utilised his existing knowledge of cryptocurrency and has made Binance a major player in the cryptocurrency exchange platforms with its unique features and effortless trading.
What is Binance?
Binance is the largest online cryptocurrency exchange trading platform founded in 2017. The company was initially based in China and is currently headquartered in Malta due to the increasing regulation of cryptocurrency in China.
Who is the founder and owner of the Binance?
The cryptocurrency exchange platform Binance was founded by Changpeng Zhao in 2017. Previously, he had founded a company in Shanghai that built a high-frequency trading system for stockbrokers, Fusion Systems in 2005.
How much profit has Binance made as of 2020?
Binance is expected earn profit of $800 million to $1 billion in 2020. In 2019, Binance earned a profit of $570 million.