Binance Coin prediction 2020
Binance Coin is an unusual and interesting cryptocurrency. How high can it go this year?
You probably know that Binance is the world’s biggest cryptocurrency exchange, a place where you can buy over 100 different coins.
You also might know that Binance was one of the pioneers of the concept of IEOs or Initial Exchange Offerings. These are a way that businesses raise money via coin sales and are tipped by some pundits to be the successor to the Initial Coin Offering or ICO.
What you might not know is that Binance also has its own coin, called appropriately enough Binance Coin (BNB). It first went on sale in late 2017 and since then has gone on to establish itself as one of the most successful coins by value, recently crashing into the top ten.
In many ways it is one of the most interesting and unique coins currently available, and several of the key crypto tipsters believe that it has a positive future.
Why should you buy Binance Coin?
So what is the Binance Coin and why should you consider buying it? What is the Binance Coin prediction for 2020?
Before undertaking Binance Coin price analysis potential buyers need to understand the nuances of the coin; it certainly is not your average crypto.
Firstly, and most importantly, Binance Coin is the official coin of the Binance exchange. From the moment it launched the coin the company has promoted it by offering sweeteners to people using it on its platform.
So when the coin was minted back in 2018 Binance offered users of the coin discounts on the exchange. For the first year the discount was 50 per cent. Since then discounts have reduced in half each year. So in 2020 it is now 12.5 per cent. Next year it will be 6.75 per cent and the year after, 2022, nothing at all.
At the same time the Binance team came up with another way of increasing the value of the coin, by making it more scarce. Hence every quarter the board of directors of the Binance buys BNB tokens from the digital market with 20 per cent of the profit they’ve made from transaction fees, and then burns them. The strategy is to reduce the number of coins by 50 per cent leaving a finite 100 million tokens. Each time this happens the price of the Binance coin is impacted.
Yet the Binance Coin isn’t only for people who use the exchange. As its popularity has increased over the years other uses have come into play. Just like Bitcoin, or indeed most cryptocurrencies, it can be traded as an asset, bought and sold with individuals speculating on its price.
It can also be used to pay for goods and services too with a growing number of online retailers now accepting the coin as payment.
Binance Coin 2020 prediction
So how then is the Binance Coin likely to perform in the future? Well if we examine its past performance some clear indicators emerge.
Firstly it is allied to the performance of cryptocurrency in general and Bitcoin in particular. Obviously if the Binance exchange is busy with people buying coins, more people are using the Binance Coin, which will impact on its value. So its trajectory, like a lot of other alt coins, does mirror Bitcoin. In the past two years, for example, it recovered after a difficult 2018, rose to a peak in June 2019 and then started to slide. Just like Bitcoin.
Secondly the Binance Coin is tied to the performance of the exchange as a whole. If Binance continues to flourish, so in theory should the coin. The company has been through a lot of changes in a short period of time. It started in China and then, when negative noises about crypto started emanating from the Chinese government, moved to Japan. It has recently opened offices in the US and in the Channel Islands and unlike some other exchanges it offers trading in Russian Roubles. It appears to have a loyal and active community and in the long run this surely has to be good for the coin.
You may remember that in May 2019 the Binance exchange was hacked and that over $40milion of Bitcoin was stolen. Strangely this didn't impact too greatly on the coin’s performance.
Another element of the Binance offering is the Binance Launchpad, the place where it runs its IEOs (Initial Exchange Offerings). For more details about IEOs read this article, but suffice to say for now, they offer coin-based start-ups a way of raising money that is more legitimate and regulated than ICOs. If the number of IEOs running through Launchpad continues then the Binance Coin could in theory benefit from this.
Lastly, every time the coins are burned by the Binance execs, the Binance Coin heads up a little in value. The bounce is often temporary and the coin price settles fairly quickly afterwards.
2020 Binance Coin price and prediction
For most of 2018 the Binance Coins sold for around $10, though there was an early peak when it went as high as $20, inspired by the novelty of the coin and the general positive outlook for cryptocurrencies.
Last year it steadily rose reaching a peak of nearly $40 in June. Once again this mirrored the general trend of cryptocurrencies. It has since fallen back and is now selling for around $18.
So how high is the Binance Coin likely to go? What is the Binance Coin prediction for 2020?
As was mentioned before much could depend on the performance of Binance as a company and Bitcoin as a cryptocurrency. WalletInvestors, for example, predicted correctly that the price would be around $20 at the start of 2020. It thinks that a rise of up to $40 by the summer is likely though there will be a degree of market correction, which will see the BNB price land at around $26. It thinks that Binance Coin will grow steadily over the years keeping to this type of trajectory.
Other forecasters like DigitalCoinPrice also project modest growth with the coin peaking at between $30 and $40 this year.
From an investor's perspective Binance Coin is one of the most interesting in that there are so many elements that could impact its price. Working out whether it is the macro factors, like the general price of cryptocurrencies, or the bespoke ones, like the success of Binance Launchpad IEOs, is perhaps the key to unlocking its future price and making an accurate Binance Coin forecast.
It should be noted that in June 2021, FCA, the UK financial regulator, issued a warning on Binance Markets Limited (BLM) and the Binance Group, ruling that BLM “is not permitted to undertake any regulated activity in the UK” as it lacks authorisation.
The watchdog also advised people to be “wary of adverts on social media promising high returns on investment in cryptoassets”.
Binance, the world’s biggest cryptocurrency exchange, said that “BML is a separate legal entity” and the FCA notice would have no “direct impact on the services it provides from the Binance.com”.
The Binance Group acquired BML in May 2020 and has not yet launched its UK business or used its FCA regulatory permissions.
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