Binance has become the market leading exchange in terms of liquidity, low fees, and number of crypto pairs. They also trailblazer in terms of innovation and valuable giveaways to customers. Get 10% off your trading fees, exclusive to BitReview customers.
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- #1 volume exchange in the whole crypto market!
- Two bitcoin daily withdrawal limit on an email-only account
- Low fees and hundreds of bitcoin and ethereum markets
- No real fiat liquidity, although GBP and EUR available on the Binance Jersey site.
- Scams listed if they can afford the listing fee.
When we initially reviewed Binance sometime in the beginning of 2018, we lauded them for quickly becoming a dominant multicoin exchange. We gave props to Changpeng Zhao for demonstrating a savante like ability to rise in the market, as well as being a good bitcoin citizen, and apparently all-around quality guy.
We thought we were giving high praise, but boy, did we miss just what Binance was building. Yes, they are now arguably the most important exchange in the market. Yes, funds seem SAFU with Binance. And yes, they have the most liquidity, the best pricing, the most cryptos, and the best promotions. However, the amount of innovation and investment they are pouring into the market is something nobody could have anticipated. Binance is setting benchmarks, and then breaking those benchmarks and setting new ones.
They have developed their own coin (BNB) which was initially simply used for trading discounts. However, having established a market for the coin, it is now being used it to power a new decentralized exchange (Binance DEX) which might eventually disrupt the custodial exchange market.
They have become the place to launch new projects through their launchpad mechanism, and use the listing fees in support of their philanthropic arm, the Binance Charity Foundation. And their innovation hub actively seeks new projects for investment that further the crypto marketplace.
Binance is working on getting into the fiat markets as well – currently a Binance skin offers euro and GBP markets, and they are working to launch in the United States as well.
An email is all it takes for a two bitcoin or equivalent daily withdrawal limit; that dusts the competition. Want to bump that up to 100 bitcoin? You need submit personal details, submit a copy of your passport / driver’s license, and smile for the camera – there is an embedded facial recognition software used as part of the KYC.
Binance has 100s of different crypto assets which trade against a few main markets – BTC, ETH and BNB primarily. Ripple has two different markets as well. The main market traded on Binance is btc/usdt (tether), but Binance also incorporates four additional stable coins that trade against various alts.
If you are trading a specific pair, the “advanced” exchange offers more tradingview charting functionality.
Binance’s btc/usdt is the most liquid bitcoin market in the world, with daily volumes regularly exceeding $1b. This will no doubt increase dramatically once margin is integrated to the wider Binance community. The platform is very stable now as well, and seldom experiences downtime during massive trading spikes, as is often the case with, for instance, coinbase.
While we are perfectly content with the web-based trading platform, there is a downloadable version available that is more heavy duty. Mobile apps for both iphone and Android do not currently allow trading, they only display real-time market prices.
Margin Trading on Binance
After months of anticipation, Binance finally introduced margin trading or bitcoin, ethereum, Ripple, Binance Coin, And Tron. Binance will initially offer margin of 3:1, and will act as the lender charging s 0.02% daily interest rate, .1% on BNB.
Your margin level determines the risk of your trade being liquidated, and is calculated by the following formula: Total controlled position / total borrowed + total interest rate.
Let’s imagine that you would like to leverage 1 bitcoin 3X, to control 3 bitcoin in the market. For simplicity, let’s pretend bitcoin is worth $10,000. Binance would lend the $20,000 to purchase the additional 2 bitcoin. The moment the order is placed, your margin level would then be 1.5 –
Total controlled position / total borrowed + total interest rate = $30,000/20,000 + 0 = 1.5
If the value of bitcoin drops to the point where your margin level is 1.3, which is basically a drop in bitcoin price of ~13.4% ($8,666 in our scenario), you receive a margin call. The margin call is a reminder to boost your balance or reduce your exposure to avoid being liquidated. If your margin level drops to 1.1, or around $7,350 in the above example, your position wiill be liquidated – REKT, as they say.
Binance is still an overwhelmingly crypto-only ecosystem, but moves are being made to bring fiat deposits and markets into the equation. In the beginning of 2019 Binance partnered with Simplex to offer credit card purchases of cryptocurrency via binance.com.
|Credit Card||Fee||Cryptos||Minimum Order (USD)||Maximum Order (USD)|
|Visa, Mastercard||3.5% or $10, whichever higher||BTC, BNB, XRP, ETH, LTC, BCH||$50||$20,000|
Jersey represents the licensing jurisdiction under which Binance is regulated to offer EUR and GBP trading markets. The volume is very low, but there is a bit of action. Deposit and withdrawal fees are waived until the end of 2019, and the trading fee is reduced from .1% to .05%, also until the end of the year.
Security at any crypto exchange is difficult; security at the largest exchange in the world, with hundreds of cryptoassets listed, redefines difficult. Binance has been proactive in protecting the assets of their clients.
Users will be hounded continuously to set up 2 factor authentication, and customers may set up offered the opportunity to whitelist withdrawal addresses and IPs. Of course, with Sim swapping becoming more prevalent, this is not necessarily enough anymore; Binance uses big data and AI solutions to monitor suspicious activity, and has a good chance to realize your account has been compromised before you are aware.
Binance is SAFU – 10% of all trading fees are allocated into a “secure asset fund for users”, stored in a separate cold wallet and used to compensate users in a disaster scenario. That is a lot of money.
The acquisition of Trust Wallet may also be considered a proactive step towards security. Private keys are generated and stored locally – i.e. on the customer device, meaning the customer secures his own keys, and thus controls his own coin. As the official wallet of Binance, Trust Wallet encourages users to move funds off of Binance, thus helping to reduce the amount of coin held on the exchange.
But the Trust Wallet acquisition was not solely to enhance the security ecosystem of Binance. This was an excellent acquisition for Binance.
The plan, now executed, is for Trust Wallet to support the Binance DEX (Decentralized Exchange). The Binance DEX allows for the trading of BEP2 (Binance Chain) tokens from wallet to wallet without intermediary, using BNB used as the fee mechanism and the Binance Block as the settlement mechanism.
There is quite a buzz around the potential of Decentralized exchanges. Standard exchanges represent a single centralized point in the crypto ecosystem, which can be targeted by hackers or governments for any number of different purposes. Exchanges are the intermediary in a market meant to disintermediate finance. At the moment, the Binance DEX only supports BEP2 tokens, which have limited appeal. However, the massive crypto ecosystem of Binance provides a massive potential pool of DEX liquidity, making the Binance DEX perhaps the best real world example of functioning decentralized exchange.
Again, Binance demonstrates an exceptional degree of market innovation, which serves also to secure the company’s future. If the DEX model will eventually disrupt the standard exchange model which Binance currently dominates, Binance will anyway be leading the disruption.
Binance is the most important exchange for altcoins, full stop. When a coin launches on Binance, it is introduced to an unparalleled level of liquidity, as well as the most targeted demographic available to hit with marketing messages.
Marketing takes a very specific character in the Binance ecosystem, centered around the Binance Launchpad. The Binance Launchpad is “A token launchpad for transformative projects”, designed to create a marketplace within Binance for qualifying cryptocurrency projects. All prospective projects must submit an application form, and continuously update the status of the project via an online project portal.
The character of the “tips” for admittance into the Binance launchpad are illustrative of how Binance uses these coin launches to develop its own business.
Coins that launch using the binance chain have an advantage. Coins that are already trading on the binance DEX have a very significant advantage. The more volume the better.
Incorporation of the Binance Coin, either into the project ecosystem or into the initial fundraising, will provide an advantage.
Active participants / contributors to the Binance ecosystem also gain a leg up.
Additionally, there is a listing fee. This was rumored to have been up to a whopping $2.6M, but facing backlash, Binance promised to donate all coin listing proceeds to charity. The fee varies now, based on the project.
Getting listed via the launchpad, which is like winning the lottery for these projects (apparently 98% of applicants never even hear back from Binance), allows for a launch promotion.
If there was no market for a coin before (if there was no purpose for a coin before), a Binance token launch promotion creates the market, and the attendant FOMO required to pump price.
Token launches are currently run in a lottery format. Binance customers are allocated lottery tickets based on the average amount of Binance Coin they have held over the previous 20 day period. Customers may claim up to 5 lottery tickets. Each lottery ticket, should it be randomly chosen, obligates the holder to purchase a predetermined amount of tokens – for example, $500 worth per ticket. This is paid in BNB.
The process really is a masterstroke. Not only does Binance leverage an unmatched reach amongst the altcoin trading demographic in support of new, often entirely Binance-dependent coins, the Binance Coin is integrated into the process at multiple touchpoints, mobilizing the formidable Binance ecosystem to create market utility for its own coin.
Binance Charity Foundation is a nonprofit organization dedicated to improving the lot of the “bottom billion”.
Binance is to be applauded for leveraging their amazing success into active philanthropy. Their goals are three pronged: 1) Accelerate sustainable development. 2) Improve donation transparency, and 3) expand the use cases for cryptocurrency. While we generally huffaw at the attempt to stick a blockchain on everything, in this case it makes the whole charitable more relevant to the Binance community which fosters cooperation and interest. And hey, if some use cases are developed for blockchain, that is a great byproduct.
There are lots of exchanges out there, but there is only one Binance. Binance offers:
- The cryptoworld’s most liquid exchange
- The lowest fees in the market, from .1% to as low as .03% for high rollers.
- Hundreds of different crypto markets
- Early Access to coin launches
And the company’s commitment to innovation within the exchange market in particular and the crypto industry in general makes us believers in their staying power, right at the top.
Very much recommend joining Binance! Please user referral ID 12656320 when registering