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What is Binance?

What is Binance?

Binance appeared on the market in 2017 and, in just six months, has become the best and largest cryptocurrency exchange in the world. Today, it is a whole ecosystem of financial products, providing an efficient infrastructure for the entire crypto industry. 

Full name of the company: Binance

Foundation date: 2017

Founder: Changpeng "CZ" Zhao (PRC)

Capitalization: more than $1.9 trillion

Legal status: the first registration - in China, after the ban - supposedly the registration was changed to the Virgin Islands, then to the Cayman Islands. As of today, the exact legal address has not been disclosed.  

Market geography: more than 180 countries, including the U.S., Japan, and many island nations.

Company products

Cryptocurrency exchange – Currently, it is the world's leading cryptocurrency exchange trading platform, offering its customers a full range of investment and trading services.

The following types of trading are available to Binance customers:

  • Spot trading – all transactions are made in instant delivery mode. In other words, cryptocurrency is exchanged for real money. More than 1200 trading pairs of cryptocurrencies and fiat are available at the crypto exchange;
  • Margin trading – trader gets a leverage tool to operate with large amounts of money if his/her own deposit is not enough;
  • Futures trading – access to futures contracts for Bitcoin, Litecoin, EOS, Ethereum, Ripple, and Bitcoin Cash cryptocurrencies. Each tool has its own leverage;
  • P2P – sale and purchase of cryptocurrency via user payment transfers (available for Visa, MasterCard, PayPal, etc.). 

Binance Chain public blockchain – it is a public blockchain that involves the entire Binance community. It is designed for instant transactions but is also used as an alternative trading platform for issuing tokens and exchanging digital assets. The main advantage of Binance Chain is its high throughput.

Today, blockchain is implemented in the form of Binance DEX, a decentralized exchange featuring the best brand functionality and enhanced security. Its structure is represented by a distributed network of nodes, which allows users to use this site to store private keys and manage cryptocurrencies.

Binance Smart Chain Blockchain – it is another blockchain developed by Binance. It operates alongside Binance Chain but has a wider functionality, and its main feature is the use of smart contracts and compatibility with the Ethereum virtual machine.

Binance Smart Chain is an independent blockchain that supports a wide range of Ethereum tools and DApps (decentralized applications) so that developers can easily migrate created projects to the platform.

This product offers low transaction fees, and the Proof of Staked Authority consensus protocol ensures scalability. Binance Smart Chain uses BEP-20 tokens (analog of ERC-20). It can be used to create fungible digital currencies or tokens, while assets from other networks can easily be transferred to the Binance blockchain and linked to BEP-20 tokens.

BNB cryptocurrency and token represent a virtual asset to work on the Binance cryptocurrency exchange to make transactions and pay fees. At the same time, it is used as a cryptocurrency to maintain the BNB Chain ecosystem, and it is the most popular service token in the world.

BNB was launched via ICO in 2017, and at that time, 1 ETH was worth 2,700 BNB, while 1 BTC was worth 20 thousand BNB. It is not an investment coin and does not entitle to make a profit, but it is used for such purposes as:

  • Reduction of trading fees at the Binance cryptocurrency exchange;
  • Commission payment for trading operations on the decentralized Binance DEX platform;
  • Payment for goods and services on the Internet or in a physical store (you must have a Binance Card or Binance Pay wallet);
  • As a supporting token in the BNB Chain ecosystem (relevant for games and DApps);
  • Participation in token sales, which are held on Binance Launchpad.

Binance Launchpad token sale platform is a custom platform for attracting investors to promising crypto projects. All users can buy tokens at an early stage at a reduced price, which may grow in the future and bring profit to its owner. 

Launchpad can be accessed via the cryptocurrency exchange website, where the user can join the token sale in the corresponding section of Binance Earn. It is obligatory to have a certain amount of BNB on the account (minimum value - 0,1 BNB) to participate in purchasing coins.

Binance Bridge cross-chain bridge – this technology is designed to link different blockchain networks and ensure their effective interaction. Using Binance Bridge, you can convert any cryptocurrency into Binance Chain and Binance Smart Chain tokens.

Binance Bridge cross-chain bridge supports the conversion of ERC-20 and TRC-20 tokens into BEP-20 virtual assets. There is no fee for the conversion, but users must pay a network fee within each blockchain. 

Binance Pay payment system – the launch of its own payment system Binance Pay took place in 2021. This service works effectively, allowing users to make transactions to send and receive cryptocurrencies.

There are currently 5 virtual coins supported: Bitcoin (BTC); Ethereum (ETH); Stablecoin BUSD; internal BNB coin; SXP token from the Swipe project.

Using the QR-code option in the installed application, you can quickly transfer crypto-assets from your account.

The first partner in the Binance Pay operation is the Travala.com service, allowing customers to book travel products using cryptocurrencies. Large websites and restaurants have already joined the payment system.

Binance Cloud Solution is a unique turnkey development for anyone who wants to launch their own platform to exchange digital financial assets. The technology combines high security with good liquidity, providing a full infrastructure for the exchange so that the partner can focus as much as possible on the development and his customers.

Using Binance Cloud, users benefit from a convenient method of setting up a cryptocurrency platform in local markets. It combines spot and futures markets; it is integrated with local bank APIs and supports fiat-to-crypto currency exchange services between users.

Binance Liquid Swap liquidity pool platform – this Binance solution represents a platform as a single Automated Market Maker (AMM) pool, uniting various liquidity pools, using which users can exchange cryptocurrency assets.

By adding coins to pools via Binance Liquid Swap, it is possible to use the entire capacity of the algorithm upon which asset prices are set. This provides stability of fees on small and large transactions conducted in the instant swap mode.

The following pairs are available for exchange:


Among the key advantages of Binance Liquid Swap are:

  • User-friendly interface;
  • Large selection of pools on the platform;
  • Receiving a reward in the form of BNB;
  • Improvement of all functions of DeFi products;
  • High security.

Binance NFT – the company launched its own NFT marketplace in mid-2021, and today, it features various types of digital art and collectibles.

The Binance NFT platform is based on blockchain and its infrastructure, focused primarily on the Binance community. It features the highest liquidity for launching NFTs created by artists, authors and just cryptosphere enthusiasts.

The following product options are available:

  • The marketplace itself - for creating, selling, buying and auctioning NFTs;
  • Important events - you can buy exclusive NFTs of prominent artists and reputable brands, creators. You can participate in events hosted by digital musicians, athletes, showbiz stars, and artists;
  • Mystery boxes - they are a kind of lottery, each with a random NFT hidden in it. You can win both the most common and a very rare product.

Binance Academy Learning Center – it is an open and accessible educational project created by Binance. It includes a database and educational materials about the crypto sphere and blockchain, 450 articles and videos, available in 15 languages.

Binance Academy is a non-profit product that provides quality and easy-to-understand content for a wide audience in order to learn about the world of digital assets.


2017 – Former futures trading software developer and head of research at Bloomberg Tradebook Futures, Changpeng Zhao (known in the crypto community as CZ), creates his own global project Binance.

In the summer of 2017, prior to the site's official launch, an ICO was held, raising a total of $15 million. Investors received a BNB token, using which they could pay fees. Chinese and Asian representatives were the first interested parties in the project's development.

In just six months, the project has not only gained worldwide recognition but has also become the best exchange in the market for transactions in digital assets, supported by a multimillion-strong audience of registered traders. There were over 20 thousand users since the platform's launch, and this figure was growing very quickly. For example, in 2018, the exchange was forced to temporarily stop registering new clients to update its architecture.

2018 – Binance topped the list of cryptocurrency exchanges in terms of trading volume, and Changpeng Zhao graced the cover of Forbes magazine.

Until early spring, the company managed to operate in Taiwan-based offices. However, due to the increasing Chinese restrictions, as well as the introduction of strict regulations in Japan, Binance planned to open an office in Malta. As early as April, a Memorandum of Understanding was signed with the government of Bermuda, and a few months later, the cryptocurrency platform entered into a similar memorandum with the Malta Stock Exchange to develop a platform for digital trading.

In an interview with Bloomberg, Changpeng Zhao spoke about such cooperation and the prospects of working with local banks, as Malta represented a progressive country in developing crypto-industry and financial technology.

2019 – a Binance Jersey subsidiary appeared in the Binance structure in order to become an independent company and thereby expand its influence in the European market. The technical facilities were hosted on the Channel Island of Jersey, while users were offered trading pairs of cryptocurrencies and fiat, as well as euros and pound sterling.

The cooperation with the Israeli payment service Simplex was launched, so customers could buy cryptocurrencies using their debit and credit cards, including Visa and MasterCard.

On May 7, the Binance cryptocurrency exchange suffered a hacking attack, becoming the worst in the company's history. The attackers withdrew about 7,000 Bitcoins, which at the time was worth $41 million. The general director of the trading platform stated that it was the largest hack when hackers withdrew funds in several stages and transferred them to a single purse.

That was a carefully planned attack, where attackers gained access to users' API keys, all two-factor verification codes, and sensitive data. Notably, attackers hacked the crypto exchange's hot Bitcoin wallet, which held about 2 percent of the total Bitcoin amount. Other wallets remained safe.

Following the attack, Binance announced that the damage would be covered by its own SAFU foundation and that user funds wouldn't be involved in any way.

In that same year, the company became the owner of such businesses and projects:

  • Trust Wallet provider;
  • launching DappReview blockchain data;
  • India-based crypto exchange WazirX;
  • JEX platform in Seychelles.

A standalone branch of Binance US, serving only U.S. customers, started operating in the U.S. territory. By 2021 the company was licensed in 42 states.

2020 – The year started with a public statement issued by the Maltese Financial Services Authority about Binance illegally operating with no registration and no headquarters, thus contravening the country's laws.

That didn't stop the company from launching the IEO Matic Network, a collaboration and scaling platform to create blockchains that would be compatible with the Ethereum network.

In Ukraine, Binance opened an account at Ibox Bank, allowing the company to become the first legal crypto platform in the country.

In mid-spring, the company was already in the final stages of buying CoinMarketCap, a crypto data aggregator. The acquisition price was roughly $400 million.

Binance Smart Chain, a blockchain platform, was launched in the fall, making a major contribution to the development of decentralized finance (DeFi). However, during the same period, the crypto exchange faced the problem of getting its website blocked in the Russian Federation due to legislative changes regarding the ban on the use of cryptocurrencies.

Cryptocurrency exchange Binance was involved in a presentation scandal. Forbes magazine got a 2018 presentation in which Changpeng Zhao's project represented a complex corporate structure designed to defraud regulators and covertly profit from American crypto investors intentionally. In fact, that document was created by Harry Zhou, who worked at Binance and was a co-founder of KoiTrading (a Binance property) crypto platform. The company's CEO himself made a tweet justifying that none of his employees were involved in the creation of the presentation.

Based on the SimilarWeb data, by the end of 2020, the daily turnover on the Binance exchange reached 10 billion dollars, and the platform itself covered 21.3 percent of the entire crypto industry traffic.

2021 – global financial regulators required mandatory verification of all user accounts (KYC) to ensure asset protection and effectively combat fraud. That caused some difficulties in the work of Binance. At the same time, Changpeng Zhao repeatedly stated that each week experts deleted about a hundred fake websites, applications, and accounts on social networks featuring the name Binance.

In spring, the CEO of the crypto exchange announced that Binance would not enter the IPO as it had enough capital for growth. Moreover, the company would become a decentralized autonomous organization (DAO) in the future.

At the same time, German regulators evaluated the sale of tokenized shares of Tesla and Coinbase on the Binance platform as a possible violation of securities regulation laws. The conflict was that European regulators doubted the status of tokenized shares, being unsure whether they were securities or derivatives and whether they could be transferred or sold to holders. It resulted in the necessity for the issuer to provide a draft emission prospectus filing it to the relevant supervisory authority.

Binance replied to this claim that such assets did not grant owners any rights of transfer or sale, as well as did not provide voting rights, so there was no need for a prospectus.

Bloomberg reported on an investigation by the Department of Justice and the Internal Revenue Service against Binance Holding Ltd. The investigation concerned whether the company was involved in illegal activities and money laundering. Individuals familiar with the company's work were asked for information.

According to forensics firm Chainalysis Inc., after reviewing all Binance transactions, it was determined that a huge amount of funds related to criminal activity passed through the platform.

In early summer, the U.K. imposed a ban on the continued operation of Binance Markets Ltd's cryptocurrency platform. At the same time, the platform was undergoing scrutiny by U.S. agencies and Japanese financial watchdogs.

Malaysia was another country that stopped cooperating with Binance. The crypto exchange website and all mobile applications were disabled in the country.

In the same period, three countries simultaneously represented by Singapore, Thailand, and the Cayman Islands, started an inspection of Binance. The latter alleged a lack of registration and improper provision of services. Thailand notified the company that it was operating without a license and submitted a report on the violation to the economic crime watchdog. Singapore said it closely monitors Binance's subsidiary, Binance Asia Services Pte. In December, it had already ceased to operate.

As of August, Binance was banned by the Netherlands because it lacked legal registration and did not comply with the Anti-Money Laundering Act. 

2022 – Binance Holding Ltd. created its own insurance fund of $1 billion for customers because of the increased incidence of cryptocurrency hacks.

In February, the company invested $200 million in Forbes, making Binance the largest owner of the magazine.

In the wake of military events following Russia's attack on Ukraine, the cryptocurrency exchange said it would not freeze the assets of Russian users unilaterally since it contradicts the spirit of the cryptocurrency community. However, it will comply with U.S. and E.U. sanctions and freeze the assets of persons on the sanctions lists. 

Since March, Binance has been providing licensed services in Dubai and Bahrain, paving the way for expansion in the Middle East.

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