Since its founding in 2017, Binance has grown into one of the very largest cryptocurrency exchanges in the world. The exchange processes an astounding 1.4 million transactions every second, for an average daily volume of more than $3.8 billion for 2020 (and sometimes a lot more: as of this writing, the platform’s 24-hour volume was over $32 billion). So it is imperative that any cryptocurrency investor learn about some of the benefits and drawbacks to trading on the Binance platform. Read on for a closer look.
Overview for Fast Readers
- Binance is one of the most popular crypto exchanges in the world, powering nearly a million and a half transactions every second.
- Binance is powered by BNB, the platform’s native crypto token, which provides discounts on transaction fees, among other benefits.
- Some of Binance’s major strengths include strong liquidity, a robust list of cryptocurrencies, access to trades using fiat currency, and a range of additional services including Binance Info and Binance Launchpad.
- Some of Binance’s disadvantages include a lengthy account creation period, a potentially overwhelming amount of information and list of cryptos for beginner investors, and a comparably limited U.S. platform, Binance.US.
A Transparent Binance Review
How has Binance skyrocketed to the top of an ever-growing list of cryptocurrency exchanges in just a few short years? A major part of Binance’s success has been its fast transaction execution speeds, its wide cryptocurrency offerings, and its strong liquidity. In the cryptocurrency exchange world, already-popular platforms have a significant advantage over up-and-coming exchanges, and Binance’s position only helps it to grow further. What’s more, Binance offers a host of additional services. Binance.US is the company’s dedicated U.S. exchange; Binance Academy is an open-access learning hub for all things crypto; Binance Charity supports blockchain-based philanthropy efforts; Binance Info is a cryptocurrency encyclopedia; and Binance Launchpad is a token launch platform. This isn’t a comprehensive list, as there are several other offerings as well. Combined, these services make Binance an incredibly valuable tool for all types of participants in the cryptocurrency ecosystem.
This is not to say, however, that Binance is necessarily the best exchange for every crypto investor. Below, we detail some of the advantages of this platform, as well as some of its disadvantages.
Advantages of Binance
For many cryptocurrency investors, the decision about an exchange comes down to a few fundamentals including selection, fees, and convenience. Here is where Binance stands in each of these categories.
Established in the Crypto World
Binance is among the most popular cryptocurrency exchanges on the planet. Although the company does not publicize information about the details of its user base, it is likely that the platform has a substantial number of users. A highly active user community is necessary to drive the massive trading volume taking place over the Binance platform. Nearly $4 billion in trading volume is processed every day, and this number continues to grow.
This means that users around the world are relying on Binance more and more for their crypto needs. In many ways, there is strength in numbers in the cryptocurrency space: a strong and active user base generally signals positively for liquidity and security, among other important factors.
More Than 180 Cryptocurrencies Available
As of the end of 2020, Binance listed more than 180 tokens through its platform. This is an exceptional variety of tokens compared with many other exchanges, including some of the most popular alternative platforms.
Binance includes the most popular crypto tokens, such as Bitcoin, Ethereum, and Cardano. It also provides a platform for trading a host of altcoins and up-and-coming alternatives to major cryptos. This adds to the exchange’s appeal to both new crypto investors looking to gain access to the most commonly traded coins and niche investors hoping to trade obscure or lesser-known tokens as well.
Low Fees With BNB
One of the major advantages of Binance is BNB, the native coin of the Binance platform. BNB has several potential uses, including powering transactions on the Binance chain, making in-store payments, and trading as its own independent token. As of this writing, BNB is the third-largest cryptocurrency by market capitalization, with a market cap of more than $84 billion.
Perhaps the most powerful use for BNB for Binance users who make frequent trades, however, is as a means to pay for transaction fees. By using BNB to pay for trading fees, you are eligible to receive a discount of 25% off of the fee cost. Additional fee reductions apply for special categories of transactions as well, providing users of all kinds with an added incentive to hold and use BNB for fee payments.
Buying Crypto With Fiat is Possible
Binance is designed to support users all over the world, and one way that the platform is globally focused is in its fiat currency support. If you are new to cryptocurrencies and need to purchase tokens with fiat currency, or if you’d rather buy using fiat, Binance supports a host of options. U.S. dollar, South Korean won, British pound sterling, euro, Russian ruble, and many other fiat currencies are all supported on the platform.
Disadvantages of Binance
Even a robust platform like Binance may leave something to be desired for some customers. Below, we’ll look more closely at some potential disadvantages of using Binance.
Limited Access to Customer Support
One of the most common complaints about Binance is that its customer support is lacking. While the Binance site is full of ample information, in cases in which a customer is looking for assistance with one particular issue, it can be difficult to reach a support representative. The basic support page sets up a chat:
You can also file a support ticket using the platform’s in-house message service. When the reviewer attempted to reach a representative in this way with multiple messages, none of them received a reply. There is no readily available customer service phone number. All of this may combine to leave customers feeling alone in trying to navigate any issues that arise with their accounts.
May Be Overwhelming For Beginners
Like with many cryptocurrency exchanges, Binance provides a huge amount of information. This can be overwhelming for beginners who are looking to get started buying and selling crypto quickly. The account creation process can be lengthy, and even the basic dashboard contains a substantial amount of information. Binance’s wide range of cryptos can also be overwhelming, as the platform offers access to a number of highly volatile or risky altcoins. On the other hand, many users may see the robust account homepage and crypto offerings as a benefit to Binance, so it is a matter of individual preference.
Potential for Lengthy KYC Process
The Binance know-your-customer (KYC) process—necessary to protect the security of a customer’s account and to secure the Binance ecosystem more broadly—has the potential to be incredibly lengthy. When the reviewer created an account, the KYC process took well over a month to complete, including multiple attempts to submit the same information and multiple support tickets filed. Because the KYC process has to be completed before funding or withdrawing from an account or buying and selling tokens, there is not much that can be done on the Binance platform in the meantime.
Comparatively Limited Scope for Binance.US
Binance.US was launched in 2019 to provide access to the Binance platform and resources for customers in the U.S. While Binance.US provides many of the same services as the original Binance platform, potential customers in the U.S. should be aware of a few comparable limitations. First, Binance.US offers fewer cryptocurrencies for trade as compared with Binance. Beyond that, Binance.US is not available throughout the U.S., and customers in 7 states as of this writing are not eligible to create accounts and make transactions through the platform.
Together, these limitations could hamper the experience of investors utilizing this platform.
Binance Trading Platform
Once your account is confirmed and verified, trading on Binance is relatively straightforward. After you’ve prepared to trade by depositing fiat currency or supplying your Binance account with crypto tokens, buying and selling cryptos can be done from one simple menu page. Open up this menu by initiating a buy or sell order from the dashboard:
Set whether you would like the order to be a buy or a sell order, or if you wish to convert between cryptos, at the top of the menu. Next, input the amount of the order below. You also have the option of indicating whether this order will recur or be a one-time order. In the menu with BTC as a default, you can select from the list of supported cryptos if you wish to buy or sell a different token. Finally, specify your payment method by selecting from one of the available options. The only other thing to do is to verify and place your order.
For a more detailed breakdown of how to buy and sell cryptos using Binance, look to the dedicated guide elsewhere on Thebitcamp.
How to Use Binance
Binance can be used to store, buy, sell, and trade cryptocurrencies. Placing orders, funding your account, withdrawing funds, and making other transactions can all be done from the central dashboard page. While many investors will utilize the Binance platform for these primary purposes, Binance offers many other resources for investors looking to dig deeper into the world of cryptos. These include more powerful analytical tools, the dedicated Binance Info resource, and more.
Binance is one of the most popular cryptocurrency exchanges in the world, thanks to its impressive selection of tokens, strong liquidity, comprehensive resources, and blazing fast transactions speeds. While the platform has some limitations—including less-than-optimal customer service, a very lengthy account creation and KYC process, and disappointing coverage for the Binance.US platform—a significant number of users find that the pros outweigh the cons. Still, if Binance does not seem to be the right choice or if you prioritize other characteristics in a crypto exchange, there are many viable alternatives. One of these options is DXOne, which may appeal to beginner investors because it carries a targeted selection of important and popular coins without exposing users to some of the most volatile or risky altcoins. While Binance has the popular BNB token which powers transactions, DXOne offers two native coins: DX1S and DX1U. These tokens provide not only discounts on trades but also dividend-earning capabilities.