By
Mayowa Adebajo
April 5th, 2024
While Binance Coin is relatively young crypto and investors only start trying their hands in trading, it’s wise to gain the understanding of main intricacies native to this crypto and learn what BNB trading has in store for crypto enthusiasts.
Cryptocurrency is an industry dominated by one major player. In fact, if you conduct a quick survey on the street, you will quickly realize that the majority of people questioned wouldn’t have the slightest inkling of what cryptocurrencies are. But the majority of them would know Bitcoin.
Bitcoin was the first cryptocurrency to gain mainstream popularity; something that has not changed over the last several years. But there is a whole new and exciting world of crypto trading available to anyone, anywhere, offering traders a bevy of alternatives. Once such alternative is called Binance Coin or BNB. And it’s now available on eToro.
Cryptocurrencies are unregulated and can fluctuate widely in price and are, therefore, not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework. Your capital is at risk.
What is BNB?
BNB coins are issued by Binance, the largest cryptocurrency exchange in the world. In addition to being stable and reliable, BNB is also a behemoth, with over 150 coins listed and a daily trade value of almost 1.5 billion dollars.
Some analysts believe that BNB is the safest cryptocurrency available in 2018. However, it would be foolhardy to make the assumption that any trade is a sure thing. BNB was made available to the public for the first time on July 25, 2017, experiencing some volatility in the first several months. But now calmer waters are appearing to prevail, and the virtual coin is enjoying a steady rise since the beginning of October 2017. As of this writing, BNB has a market cap of slightly over 1.2 billion dollars.
BNB vs Bitcoin: Main Differences
- When it comes to trading Bitcoin, a trader should always be aware of which crypto exchange they are using. Not all are equally dependable and secure. BNB is listed on Binance, one of the most secure exchanges in the world.
- Centralized vs Decentralized. Bitcoin is traded everywhere and is susceptible to a variety of influences. BNB is in a singular location, making it less prone to external circumstances, but increasingly prone to circumstances internally on Binance.
- BNB is new, launched in 2017. Bitcoin, on the other hand, has a long and proven track record, seeing the light for the first time back in 2009.
- Bitcoin has a strict cap of 21 million coins. BNB has a coin cap of 200 million. This means that over the coming years, BNB coins could overtake Bitcoin in total volume.
What Drives the Value of BNB?
Unlike Bitcoin, Ethereum and other leading cryptocurrencies, BNB is the new kid on the block. This means its market share could be smaller than the leading virtual coins for the foreseeable future. Additionally, trader portfolio allocation for cryptocurrencies is limited. The result is that crypto providers are competing for investor resources on a daily basis. For example: A trader who invests $1000 in BNB, may not have the funds available to invest in Bitcoin.
Cryptocurrencies may entice some traders due to their lack of government association, but it would be unwise to think that government action is not a major influence on their value. If the U.S government invokes a disagreeable monetary policy, this may cause traders to increase their investment in cryptocurrencies and limit their investment in the USD.
Trading BNB
BNB, now available on the eToro platform, is suitable for a wide variety of traders with differing agendas. Long-term traders can benefit from the absence of overnight fees and maintain a hold position on BNB, predicting a rise in its popularity and value.
Day traders can anticipate the potential for volatility that often provides the opportunity for short-term gain. Over the last several years, cryptocurrencies have a track record of being extremely volatile.
Those new to cryptocurrency trading may wish to consider BNB as a viable option. It is considered more stable than the majority of other cryptocurrencies, as it is backed by a single exchange with a public address. Conversely, nobody knows the identity of the person who invented Bitcoin, despite its decade-long existence.