Binance Coin (BNB) takes off – here’s what’s behind it

Binance Coin (BNB) takes off – here’s what’s behind it

The crypto exchange Binance’s exchange-owned token has been one of the top performers of the year. Now Binance has introduced a new feature for BNB that has helped the Binance Coin soar to new heights.

Led by the crypto lead horse Bitcoin, the overall market is currently showing its bullish side. The Binance Coin (BNB) is also in seventh heaven. With a daily gain of 15.17 per cent, BNB stands out among the top 10 coins with the biggest price increase. While the growing adaptation of the Bitcoin Loophole Binance Smart Chain (BSC) was primarily responsible for the strong performance in recent weeks and days, something else is behind the BNB rally this time.

Binance is now offering to stake BNB. This is according to an announcement by the crypto exchange, which Binance published on its homepage yesterday, 9 March. According to this, BNB holders can now use their tokens to generate passive income. Users can deposit their BNB for 15, 30, 60 or 90 days. The conditions depend on the duration of the lock-up period and the deposited amount, among other things.

Binance Coin Staking – an end in itself?

Binance Coin Staking is limited – according to the motto: first come, first served. It is therefore not surprising that the BNB Staking Option was sold out shortly after its launch. In any case, with NBB Staking you don’t have to give in to the illusion that you are participating in a decentralised network. The exchange has the final say on who belongs to the 21 validators of the Binance Smart Chain. It is not for nothing that the consensus mechanism of the BSC is called „Proof of Staked Authority“ – who qualifies as an „authority“ is ultimately determined by Binance.

The limited contingent of BNB Staking products ultimately points more to a marketing campaign than to an intended decentralisation of the network. For the BNB holders, however, concerns about centralisation are unlikely to dampen the bullish mood. Even those who missed the entry into NBB Staking could already profit from the mere announcement.

The Fed sets its conditions for a digital dollar

That is the demand of the people ? – Last Wednesday, the Federal Reserve released a discussion paper that sets out some of the preconditions for the launch of the digital dollar by the US central bank. The Fed seems to be really looking into the subject since Jerome Powell, Governor of the Federal Reserve, intends to discuss with the public on the possibility of a digital dollar.

Fed wants public opinion on its digital dollar

Powell offered his comments at the House of Representatives‘ Financial Services Committee hearing on Wednesday in response to questions about the concept of the digital dollar .

“It will be an important year. This will be the year in which we actively engage with the public. ”

Jerome Powell, Governor of the Federal Reserve

The Federal Reserve analysts report identifies four preconditions for the advent of a digital dollar:

the creation of clear political objectives for the currency;
the existence of a comprehensive legal framework ;
obtain broad support from stakeholders (banks, financial institutions, companies, etc.);
prepare the market for the arrival of this innovation.

Yet the Fed has no plans to present an official plan to the public . According to Powell, the political and technical questions surrounding a central bank digital currency remain . The Fed will therefore look to the public for feedback on the problems it has identified before proposing an action plan .

In the meantime, the Bitcoin Billionaire app is working on solutions to the technical challenges it has identified. It is also in talks with other central banks exploring the concept of central bank digital currency.

China leads the race for state digital currencies

The People’s Bank of China (PBoC) is currently exploring a cross-border digital currency project in collaboration with central banks in Thailand, Hong Kong and the United Arab Emirates.

At the same time, the Chinese central bank is continuing its tests on its territory. The next deadline will be a distribution of 40 million yuan ( 6 million dollars ) in the form of a lottery in a city in the southwest of the country. To participate , citizens will only have to register on a site. The PBoC, in its quest for monetary hegemony, therefore becomes the first central bank to provide for an airdrop  ! China seems to be making great strides with its project with its international partners.

These advances should not reassure the United States, which is bringing the subject back to the forefront. However, it seems unlikely that public consultation is the right way to get ahead of China on the matter.