The trading platform of eToro recently listed Binance Coin (BNB) this October and thus became the first external exchange to list the token native to the popular crypto exchange of Binance. BNB is now available on eToro alongside other prominent cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) and more.
As with all trading and investing firms, the team at eToro have issued a detailed report explaining Binance Coin (BNB) to its possible investors as well as the digital asset’s future outlook.
BNB Can Be Classified as Both a Utility Token and as A Security
The crypto exchange of Binance kicked off through a successful ICO that was held back in mid-2017. This fact has often raised questions as to whether the token is a security due to the fact that participants of the ICO and holders of BNB expect some form of benefits from the exchange.
Classifying BNB as a security therefore is left to the interpretation of the different laws of the various individual global jurisdictions.
Mati Greenspan, Senior Market Analyst at eToro and author of the report, went on to explain how BNB falls into these two categories:
- BNB does not provide exclusive access to Binance, but it does entitle the holder to a series of benefits in the platform, such as lower trading fees. In that sense, a strong case can be made for it being a utility token.
- [The] fact that the value of BNB is tied to the performance of the company (Binance) could lead to its classification as an asset token, and therefore a security.
More on BNB From the Report by Mati Greenspan
The report does acknowledge that Binance’s ICO was one of the most successful ones in 2017. Led by Changpeng Zhao, or simply CZ, Binance has a lot of plans of improving the exchange to add additional features for its clients/users.
Mati Greenspan goes on to point out the following positive facts about BNB and the exchange:
- CZ has become one of the most influential figures in the crypto space
- Specific discounts on the exchange apply when using BNB to pay for trading fees. 50% during the first year of operation; 25% during the second (current discount); 12.5% during the third; 6.25% during the fourth; and zero discounts after that
- BNB being used to support and investing in new ICOs on the platform’s launchpad
- Incentives for users to hold more BNB such as increment in referral bonuses
- Use case of BNB to pay for goods and services
- The Secure Assets Funds for Users (SAFU) to cushion clients from glitches at the exchange that might cause financial damage
- The decentralized exchange being developed that uses BNB for trading fees
- Creation of the Binance Chain that will allow BNB to migrate from an ERC20 token to the new blockchain
- The active Blockchain Charity Foundation which aims at making the process of giving more transparent