What happened
Binance Coin (CRYPTO:BNB) is up 11.4% in the past 24 hours to $374.32 per coin as of 11:16 a.m. EDT. On Sept. 29, the world’s largest cryptocurrency exchange that issues and uses the namesake coin said it doesn’t conduct any business whatsoever in China. That’s good news, as BNB has witnessed heavy sell-offs in the past month due to investors’ fears of China cracking down on Binance.
So what
The Chinese government loves cryptocurrencies as much as they love free and fair elections. For years, Chinese entrepreneurs and millionaires have been using major cryptocurrencies like Bitcoin and Ethereum to move their hard-earned money abroad, circumventing the country’s restrictive capital outflow requirements. That’s not something the Central Government likes to see.
Image source: Binance
Regulatory crackdowns in the country are intensifying. For example, Huobi Global, the ninth-largest cryptocurrency exchange globally by volume, announced it would no longer accept Chinese clients and liquidate China-based crypto accounts by the end of the year. So it’s definitely a positive to know that there’s no geographical risk with BNB and China.
Now what
The move may be the last straw needed for another bull-run on BNB. Binance coin is a multi-dimensional utility coin with two blockchains, the Binance Chain (BEP-2) and Binance Smart Chain (BEP-20). Users can use BEP-2 coins to send or receive money, validate transactions on its blockchain to earn a hefty 14% per year in interest (due to high demand), create new tokens, and swap for altcoins.
Meanwhile, users can use BEP-20 for borrowing and lending, receive a commission for trading liquidity, and more. On top of that, Binance burns a portion of its BNB holdings every quarter with its trading profits, in a move similar to stock buybacks. Binance burned $68 million worth of BNB in Q2, and the next burn will take place tomorrow. With all this in mind, Binance Coin is definitely one of the top cryptocurrencies to buy now.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.
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