eToro’s New Report Classifies Binance Coin (BNB) as a Utility Token and a Possible Security
The trading platform of eToro recently listed Binance Coin (BNB) this October and thus became the first external exchange to list the token native to the popular crypto exchange of Binance. BNB is now available on eToro alongside other prominent cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) and more.
As with all trading and investing firms, the team at eToro have issued a detailed report explaining Binance Coin (BNB) to its possible investors as well as the digital asset’s future outlook.
BNB Can Be Classified as Both a Utility Token and as A Security
The crypto exchange of Binance kicked off through a successful ICO that was held back in mid-2017. This fact has often raised questions as to whether the token is a security due to the fact that participants of the ICO and holders of BNB expect some form of benefits from the exchange.
Classifying BNB as a security therefore is left to the interpretation of the different laws of the various individual global jurisdictions.
Mati Greenspan, Senior Market Analyst at eToro and author of the report, went on to explain how BNB falls into these two categories:
BNB does not provide exclusive access to Binance, but it does entitle the holder to a series of benefits in the platform, such as lower trading fees. In that sense, a strong case can be made for it being a utility token.
[The] fact that the value of BNB is tied to the performance of the company (Binance) could lead to its classification as an asset token, and therefore a security.
More on BNB From the Report by Mati Greenspan
The report does acknowledge that Binance’s ICO was one of the most successful ones in 2017. Led by Changpeng Zhao, or simply CZ, Binance has a lot of plans of improving the exchange to add additional features for its clients/users.
Mati Greenspan goes on to point out the following positive facts about BNB and the exchange in the report:
CZ has become one of the most influential figures in the crypto space
Specific discounts on the exchange apply when using BNB to pay for trading fees. 50% during the first year of operation; 25% during the second (current discount); 12.5% during the third; 6.25% during the fourth; and zero discounts after that
BNB being used to support and investing in new ICOs on the platform’s launchpad
Incentives for users to hold more BNB such as increment in referral bonuses
Use case of BNB to pay for goods and services
The Secure Assets Funds for Users (SAFU) to cushion clients from glitches at the exchange that might cause financial damage
The decentralized exchange being developed that uses BNB for trading fees
Creation of the Binance Chain that will allow BNB to migrate from an ERC20 token to the new blockchain
The active Blockchain Charity Foundation which aims at making the process of giving more transparent
What are your thoughts on the new analysis of Binance Coin (BNB) by eToro? Please let us know in the comment section below.
Disclaimer: This article is not meant to give financial advice. Any additional opinion herein is purely the author’s and does not represent the opinion of Ethereum World News or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.