Binance Coin: BNB Any Potential in 2022?! Deep Dive!

Last week bloomberg reported that the Sec was investigating whether binance Broke securities laws in the united States with its sale of bnb way back in 2017. Now given that binance is the world’s Largest cryptocurrency exchange and bnb Is the third largest cryptocurrency the Sec’s investigations could have huge Implications for the crypto market That’s why today i’m going to give you a Brief history of binance and bnb explain How bnb works analyze its price and tell You exactly what the sec’s investigation Could mean for the crypto market [Music] Before we talk about binance and bnb There’s something you need to know about Me Financial advisor is not what it says on My university degree education and Entertainment are the only things i can Give to thee Please contact a financial advisor if Your portfolio has you howling like a Banshee If this is the first time you hear my Rhyming intro my name is guy and this Channel is about crypto the coin bureau Is home to some of the highest quality Crypto content in the world coins tokens News and reviews and other topics that Will make your head explode in a good Way of course if you’re sold subscribe

To the channel and ping that Notification bell to keep up with our Videos and with that time to get on with The show so binance and bnb here’s what You need to know Let’s start with a bit of history The binance cryptocurrency exchange was Founded in 2017 by changpeng zhao or cz For short Cz was born in china but moved to canada When he was young to join his father an Academic who had basically been kicked Out of china for being on the wrong side Of the cultural revolution After earning a computer science degree From a prestigious canadian university Cz worked building advanced trading Software for various companies around The world including bloomberg Eventually cz returned to china where he Was orange pilled by one of his friends In 2013. Cz subsequently went all in on bitcoin Going as far as selling his apartment in Shanghai to buy btc In early 2017 cz founded binance and in Mid 2017 binance held an initial coin Offering or ico of the bnb token to Secure the funding it needed to get off The ground The bnb ico raised around 15 million Dollars and cz has mentioned in many Interviews that this was the only Funding that binance has ever received

And he’s happy the exchange isn’t Controlled by vcs By early 2018 binance had become the Largest cryptocurrency exchange by Trading volume and has maintained its Number one position since that time For its first two years or so bnb’s use Cases were limited to stuff like trading Fee discounts and initial exchange Offerings on binance Then in the spring of 2019 binance Launched the binance chain and in the Autumn of 2020 launched the binance Smart chain and bnb became the native Cryptocurrency coin of both blockchains Now until recently bnb’s official name Was binance coin but in february this Year it rebranded to just bnb which Stands for build and build fact fans The binance chain and binance smart Chain also rebranded to become the bnb Chain which consists of the bnb beacon Chain formerly the binance chain and the Bnb smart chain formerly the binance Smart chain Based on the privacy policy on the bnb Chain website quote binance holdings Limited is the data controller for Personal information collected and Processed in connection with provision Of bnb chain services This suggests that binance continues to Be the primary entity behind both Blockchains

Now this is important to point out Because most cryptocurrencies were Initially built by a single software Company but are legally owned and Operated by a non-profit organization Which coordinates further development So far this has managed to shield most Crypto projects from unreasonable Regulations On that note you might want to go back And watch my video about the sec’s views On cryptocurrency it’ll help put things Into context a little later on you can Find a link to that video in the Description Anyways in terms of tech the bnb beacon Chain was built using the cosmos sdk This means it uses a proof-of-stake Blockchain with limited smart contract Functionality that can process up to 10 000 transactions per second Whereas most cosmos-based blockchains Have at least 100 validators the bnb Beacon chain only has 21 validators Which makes it extremely centralized but Also very fast Contrary to popular belief none of the Validators on the bnb beacon chain are Run by binance they’re all run by Independent third parties including Well-known crypto companies like bison Trails While there is technically no minimum Stake to become a validator on the bnb

Beacon chain validators must currently Stake a minimum of over 750 000 bnb to Become part of a validator set At bnb’s current prices that’s more than 150 million dollars Luckily delegation is possible but the Minimum stake of one bnb can still be Pricey depending on your financial Situation All bnb staked by validators or Delegates is also locked for seven days And there are slashing penalties for any Misbehaving validators Bnb staking rewards are currently Between six and seven percent for Validators and delegators which is not Too shabby when you consider that Validators and delegators only earn Rewards from transaction fees This might be a part of why the bnb Chain only has 21 validators any more Would dilute staking rewards Now as the name suggests the purpose of The bnb smart chain is to make Decentralized applications possible To that end the bnb smart chain uses a Separate smart contract compatible Blockchain that’s secured by the same 21 Validators as on the bnb beacon chain Like most smart contract blockchains the Bnb smart chain uses the ethereum Virtual machine or evm for smart Contracts An excellent article by the aax

Cryptocurrency exchange calculated that The bnb smart chain can process around 160 tps which makes sense given that the Evm is inherently limited to 300 tps Governance of the bnb smart chain also Takes place on the bmb beacon chain The bnb chain’s documentation suggests That only validators can table bnb Evolution proposals or beps to the main Chain for 1000bnb Validators also seem to be the only Entities that can vote on beps Even so it appears that anyone can table Beps to the build and build forum oddly Enough there doesn’t seem to be too much Activity there but a few beps have Apparently managed to make their way Onto the main chain stage of the process As per the bnb chain github i’ll leave Links to both sites down below In terms of tokenomics bnb exists as an Erc20 token on ethereum as a bep2 token On the bnb beacon chain and as a bep 20 Token on the bnb smart chain Bnb had an initial supply of 200 million Which also is or rather was its maximum Supply 50 of bnb’s initial supply was sold During binance’s 2017 ico and i’ll Quickly note that the bnb ico accepted Btc and eth and took place on quote Multiple platforms Now as for the rest 40 went to the Binance team and 10 went to angel

Investors All tokens have finished vesting On the binance cryptocurrency exchange Bnb is used for token farming on the Binance launch pool to participate in Token sales on the binance launch pad Used for payments in binance pay and for Trading fee discounts Most binance employees were also Reportedly taking their pay in bnb last Year Note that bnb will no longer be possible To use for trading fee discounts from Mid-july this year Bnb trading fee discounts were actually Supposed to end in mid-july last year But were extended in celebration of Binance’s fourth anniversary binance Specified that it could change this Again at any time Now as many of you will know binance Used to use a portion of its proceeds to Buy back and burn bnb every quarter as Some of you will also know binance Replaced its quarterly buyback and burn Program with an automated bnb burn in December last year According to the bnb burn info website The auto burn quote adjusts the amount Of bnb to be burned based on bnb’s price And the number of blocks generated on Bnb smart chain bsc during the quarter No further details are provided In any case around 3.8 million bmb have

Been auto burned so far and just over 34 Million bnb were burned by binance’s Quarterly burns This brings the total bnb burned to Roughly 38 million and the auto buybacks And burns will continue until 100 Million bnb have been burned In addition to binance’s auto buybacks And burns a portion of all the Transaction fees on the bnb smart chain Are also burned with the remainder going To validators as of november last year Interestingly the validators can vote to Adjust how much of each transaction fee Is burned what’s also interesting is That more than half of bnb’s total Supply of 163 million is being held by The top 10 wallets on the bnb beacon Chain with the top three wallets holding 19 18 and 13 Respectively What’s even more interesting is that Four of the top 10 wallets on the bnb Beacon chain belong to the binance team As per a tweet from january 2021 by Finance founder chiang pang zhao These four wallets alone hold almost 40 Percent of bnb’s total supply and the Largest wallet might belong to cz Himself If you watch my video about the richest People in crypto you’ll know that i Suspected cz held the top spot due to

His bnb holdings that and the fact that He went all in on btc back when it was Still in the triple digits Lo and behold forbes confirmed earlier This year that cz is in fact the richest Person in crypto and estimated his net Worth to be as high as 97 billion Dollars The caveat is that his net worth has Probably fallen quite a bit along with The rest of the crypto market Not only that but it looks like only one Of the four wallets belonging to the Binance team has been selling its bnb And it hasn’t even sold all that much Just a few million bnb Assuming the largest bmb wallet does Belong to cz then he hasn’t sold a Single coin Diamond hands The binance team’s willingness to huddle Seems to have helped bmb’s price action Which has literally been off the charts Over the last year and a half or so with An ico price of just 15 cents per bnb Any early investors who sold at or near Bnb’s top of over 600 Netted a more than 4 000 x return on Investment Now if you watch the video we did last Year about exchange tokens you’ll know That most of this price action is due to The aforementioned buyback and burns That were being done by binance

In bnb’s case the correlation seems to Be quite clear on the price chart as it Pumped near the end of the quarter However bnb’s parabolic price action Only really began when the binance smart Chain was released in september 2020 Not surprisingly binance started to Attract lots of regulatory attention When bnb became the third largest Cryptocurrency by market cap in early 2021. The real regulatory scrutiny came when Binance started to list tokenized stocks On its exchange in the second quarter of 2021 something which might also have Contributed to bnb’s rally to its All-time high By the summer binance was being attacked From all sides with some countries Kicking the exchange out of their Jurisdiction and some big banks and Payment processors cutting off support For fiat deposits and withdrawals All the while bnb was taking a beating It didn’t take long for binance to cave To the pressure by delisting all its Tokenized stocks and implementing strict Kyc requirements in accordance with the Fat f’s so-called cryptocurrency Recommendations more about that in the Description Now unfortunately these measures weren’t Enough to stop a 100 million dollar Funding round for binance’s us arm from

Falling through and it’s widely believed That regulatory issues are why brian Brooks stepped down as ceo of binance us Around this time By the end of 2021 however binance had Established multiple regulated entities In most major jurisdictions and has Since managed to re-enter most of the National markets it had been kicked out Of Binance us even managed to complete a 200 million dollar funding round in April this year The bullish developments for binance at The end of 2021 plus the news of a one Billion dollar ecosystem fund for the Binance smart chain pushed bnb close to Its all-time highs Recall that this is around the time that The binance smart chain implemented Transaction fee burns too According to bsc scan the now renamed Bnb smart chain boasts almost 170 Million unique wallets and continues to See millions of transactions every day This is why it’s so strange that only 1.5 million wallets on the bnb smart Chain hold bnb and why it’s equally Strange there are only around 2.6 Million wallets on the bnb beacon chain That hold bnb according to the bnb chain Explorer after all you need bnb to pay For transaction fees so what are those Other 160 plus million wallets doing on

The bnb chain What’s more is that the seven-day Trading volume on pancake swap looks Extremely bizarre at least according to Coin market cap Speaking of which bine hands actually Owns coin market cap as it bought the Website back in 2020 you can learn more About coin market caps history and how It stacks up against coin gecko by Checking out our video about that in the Description So this brings me to the sec’s supposed Investigation of binance over its 2017 Sale of bnb which to be fair hasn’t been Officially announced but is likely Ongoing given that binance responded by Saying they quote don’t comment on Ongoing conversations with regulators For anyone who didn’t watch the video i Told you to watch earlier the securities Exchange commission or sec is in charge Of regulating securities in the united States securities include things like Stocks different types of tradable debt And select crypto currencies Now in the sec’s eyes an asset is a Security if it meets the four criteria Of the howie test which i’ll pose as Four questions for simplicity’s sake First question did you use money to buy It Second question is the price action of The asset the same for you and everyone

Else who bought it Third question are you expecting to make A profit And fourth question are you expecting This profit because of something a Specific individual or institution is Saying or doing Now in the case of just about every Cryptocurrency the answer to the first Three questions is yes and they Therefore meet the first three criteria Of the howey test The fourth criterion is where things get Tricky however because you can’t always Identify a specific individual or Institution who’s driving the Expectation of profit you have when you Buy a coin or token In a now famous 2018 speech former sec Director bill hinman stated that Cryptocurrencies that are quote Sufficiently decentralized are not Securities something he said regarding Ethereum’s eth Although what sufficiently decentralized Actually means has never been clarified It’s assumed to mean that it’s difficult If not impossible to identify exactly Which individuals and institutions are Driving the expectations of profit Associated with a cryptocurrency With the howie test in mind it’s easy to See why the sec is going after binance Because of bnb

Much of bnb’s early price action was Explicitly driven by binance’s actions Some would argue that this is still the Case to this day and there seems to be Evidence to that effect It definitely doesn’t help that the Original binance white paper Specifically refers to the exchange’s Buybacks and burns as a quote Repurchasing plan This sounds eerily similar to a stock Buyback which is obviously off limits as Far as the sec is concerned If you’re wondering why the sec can go After binance at all i suspect this Could be because the bnb ico may have Been available to investors in the United states As i mentioned earlier binance accepted Btc and eth for the bnb ico which likely Could mean there wasn’t much kyc Involved there again just a suspicion Another way the sec can justify going After binance is the fact that bnb is Listed on binance us so even if it Wasn’t available to us investors at its Ico stage it certainly is available to Us investors today There are of course other exchange Tokens like crypto.com cro which Recently underwent a rebrand trading on U.s exchanges and though they haven’t Faced the same regulatory scrutiny it’s Possible the sec could follow suit once

It’s fried the biggest fish more about Kronos in the description Anywho to wrap things up i want to give You my take on what could happen to bmb And the rest of the crypto market if the Sec successfully cracks down on binance I’ll start by saying that in the worst Case it’s possible that bnb could get De-listed from binance us But given that most of bnb’s trading Volume is taking place on the International version of binance and Other exchanges outside of the united States it’s unlikely to have a profound Effect on bnb’s price Conversely it’s possible that binance Simply pays a small fine to the sec over Its bnb ico which is pennies on the Dollar relative to how much the exchange Is making these days The thing is that this settlement could Come with a clause that bnb is a Security and can’t be listed on u.s Exchanges Alternatively binance could succeed in Convincing the sec that although bnb was A security in its early years it has Since become sufficiently decentralized As per bill hinman’s speech and i have a Feeling this is the narrative they’re Trying to push the recent rebrand of bnb And the bnb chain says it all Now if this is the route the binance is Going down then i personally think it

Won’t succeed Based on other cases the sec definitely Doesn’t like the fact that the binance Team holds so much of bnb’s supply When it comes to what effects this could Have on the rest of the crypto market Besides a potential crackdown on other Exchange tokens i don’t actually think It would be all that seismic binance has Proven that it’s capable of wrestling Its way out of regulatory chokeholds no Matter how strong The cold hard truth is that money talks And in binance’s case it doesn’t even Have to lobby politicians countries are Welcoming the exchange with open arms Because it’s bringing high paying jobs To their jurisdictions and pouring Millions into their existing crypto Ecosystems as in the case of france At the same time crypto lobbying groups Are outspending other economic sectors To make sure that regulators don’t crack Down on crypto and you can learn more About what they’re doing and how they Work by using the link in the Description And that is all for today’s video about Binance and bnb if you found it Informative be sure to smash that like Button to help others find this info Remember to subscribe to the channel and Ping that notification bell too so you Don’t miss the next video

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