Killer Whale Crypto
July 20, 2021, 5:15 AM UTC
This article highlights the history of Binance as well as the current events regrading Binance
Binance is recognized as the largest exchange in the history of cryptocurrency. In this article, we will discuss how Binance became the highest volume cryptocurrency exchange in the world, and how the Binance exchange token (BNB) became the first ever exchange token to become a large-cap coin. We will also discuss a few of the current events surrounding the Binance exchange.
A Brief History of Binance
Binance was founded in China by Changpeng Zhao in 2017. However, due to the impending ban of cryptocurrency by the Chinese government; Binance was forced to relocate their servers and corporate head office to Japan in September of the same year. In January of 2018, Binance once more made the decision to migrate some of their corporate offices to Malta. Several months later, Binance signed a Memorandum of Understanding (MoU) with the Government of Bermuda: An agreement between two parties, which indicates a common line of action, that is used in instances where both parties cannot create a legally enforceable agreement. This is how Binance is allowed to operate some of their corporate offices in Malta.
By this time, Binance had become the world’s largest cryptocurrency exchange – with a market cap of 1.3 billion dollars – in just under 180 days from its initial inception.
In 2019, Binance launched Binance Jersey: An independent exchange, offering Fiat-to-cryptocurrency pairs, intended to expand the influence of Binance into the European countries.
Later that same year – on May 7th, 2019 – Binance officially announced that the company had fallen victim to a cocktail of cyber-attacks, which resulted in Binance loosing 7,000 bitcoins (at which point were valued at approximately 40 million dollars) to hackers. The exchange was forced to suspend all deposits and withdrawals for 12 days, until May 19th, 2019. Binance reimbursed its users by way of the company’s “Secure Asset Fund for Users.”
Binance continues to hold its place as the highest valued cryptocurrency exchange in the world, despite heavy competition from other large exchanges.
Binance Coin (BNB) was originally created on the Ethereum blockchain in 2017, as an ERC-20 token. ERC-20 is the technical standard for all smart-contract token implementation, built on the Ethereum blockchain. Out of 200 million BNB tokens Minted; 100 million BNB tokens were sold during the BNB ICO, at 15 cents per token. Another 80 million tokens were distributed to the founding team. The last 20 million tokens were distributed to BNB’s preliminary one-time investors; who supplied the initial capitol to kickstart the minting of the BNB tokens. These initial investors are known as “Angel Investors.”
Eventually BNB was adapted to serve as the native currency of Binance’s own blockchain; known as Binance Chain. Today BNB is the 4th highest ranked cryptocurrency in the world by market cap, as well as the first ever exchange token to become a large cap coin. BNB currently holds a 46-billion-dollar market cap.
Current Events Surrounding Binance
Although the cryptocurrency exchange remains the largest in the world, the company was banned from operating within the United States on regulatory grounds in 2019. Binance responded to this by creating the Binance.US exchange, with the help of other investors. Binance.US is registered with the United States Financial Crimes Enforcement Network. Although Binance.US has been specifically designed to operate within all applicable United States laws, Binance.US is currently still restricted in Connecticut, Hawaii, New York, Texas, Vermont, Idaho, and Louisiana. Although these restrictions currently remain in place, the Binance exchange is making concerted efforts to have these restrictions lifted by 2021.
In June of 2021, Binance was ordered by the United Kingdom’s Financial Conduct Authority (FCA) to cease and desist all regulated activity within the UK. The FCA began requiring official registration of all firms and exchanges relating to cryptocurrency, to comply with anti-money laundering regulations. As Binance does not currently comply with these regulations, the exchange is being forced to cease operations in the United Kingdom. Due to these circumstances, Binance was also forced to suspend all Pound Sterling withdrawals, within the United Kingdom, until further notice.
Currently the regulatory waters are unclear. Binance – being the world’s most successful cryptocurrency exchange – will undoubtably experience more flack than the smaller exchanges. Hence the reason Binance is taking the brunt of the scrutiny. As an example, the release of Binance stock tokens represented a great innovation, that has been stifled by the newfound interest of legislative parties.
There will be many more hurdles for us to overcome. Hopefully this article emphasizes the importance of financial innovations. It takes a long time to see the fruits of our toils, however we are paving the way for our future generations!