In July 2017, Binance held its Initial Coin Offering (ICO), which raised 15 million dollars in less than a minute. The ICO was so successful that the Binance team decided to use the funds to build a decentralized exchange (DEX) on the Ethereum network.
The DEX was launched in February 2019.
The Binance Coin (BNB) is the native token of the Binance DEX and is used to pay transaction fees on the platform. BNB was originally issued on the Ethereum blockchain as an ERC20 token.
In April 2019, Binance completed the mainnet swap of the BNB token and it is now running on its own blockchain, called the Binance Chain.
The total supply of BNB is capped at 200 million tokens. 100 million of these were distributed during the ICO and another 20 million were allocated for the team and advisors. The remaining 80 million were allocated for a coin burn.
A coin burn is when a cryptocurrency company destroys some of its tokens to increase the value of the remaining tokens in circulation. This is similar to a stock buyback program that a publicly traded company might do.
So far, Binance has burned a total of 16.8 million BNB, which leaves 83.2 million BNB in circulation. The most recent coin burn occurred in July 2019 and destroyed 2.
4 million BNB. At the time of this writing (August 2019), one BNB is worth about $27.50 USD.
So, how much will Binance Coin be worth in 2025? It is difficult to predict exactly how much a cryptocurrency will be worth in five years time, but we can use some basic principles of supply and demand to make an educated guess.
The price of any good or service is determined by supply and demand. If there is more demand for a good than there is supply, then the price of the good will increase.
If there is more supply than there is demand, then the price will decrease.
The total supply of BNB is capped at 200 million tokens, so no matter how high demand becomes, there will only ever be 200 million BNB in existence. This means that if demand for BNB increases while the supply remains constant, then the price of BNB will go up.
Currently, there are 83.2 million BNB in circulation and 100 million more that can be released from the company’s reserves over time (through coin burns).
This means that there could be a potential maximum supply of 183.2 million BNB by 2025 if all 100 million reserved tokens are released and no additional tokens are created through forks or other methods.
However, it is unlikely that all 100 million reserved tokens will be released by 2025 as this would decrease the value of each individual token too much (due to inflation). It is more likely that only a portion of these tokens will be released over time as needed to meet demands from users or to incentivize certain behavior on the platform (such as staking).
Based on these factors, we can estimate that there could be a maximum supply of between 183-200 million BNB by 2025 depending on how many reserved tokens are actually released by then. Now let’s look at demand factors for 2025…
Assuming that the cryptocurrency industry continues to grow at its current rate, it is reasonable to expect that there will be more demand for crypto assets in 2025 than there is today. This increased demand could come from a number of different sources including: institutional investors, retail investors, businesses, and governments/organizations using crypto assets for various purposes such as payment systems or store value (like gold).
If we assume that just 10% of global institutional money flows into crypto assets by 2025 (up from less than 1% today), this would represent an inflow of approximately $5 trillion dollars into the crypto market (based on a total market capitalization of $50 trillion by 2025). Even if only 1% of this money went into BNB specifically, this would represent an influx of $50 billion into the Binance ecosystem which would greatly increase demand for the token. Of course, it’s impossible to say exactly how much institutional money will flow into crypto assets by 2025 as this depends on a number of factors including regulatory changes, economic conditions, etc.
, but it’s not unreasonable to expect significant growth in this area based on current trends.
In addition to increased institutional investment, another factor that could drive up demand for cryptocurrency assets like BNB is mass adoption by retail investors and businesses alike..
As more people learn about cryptocurrencies and their potential uses cases , it’s likely that more individuals will want to buy them for investment or speculation purposes . In addition , as businesses begin to accept cryptocurrencies as payment , there will be increased demand for these assets from companies looking to hedge against fiat currency volatility .
These two factors could lead to significant growth in cryptocurrency markets overall , and consequently , an increase in demand for specific assets like BNB . Assuming even modest growth in these areas , it’s not unreasonable predicting strong future demand for Binanace Coin .