What is Binance?
Binance is a cryptocurrency exchange platform with operations based in Malta and is one of the world’s highest-growing and most popular exchanges. Binance is also widely known as the world’s largest cryptocurrency exchange by trading volume. The exchange was created by Changpeng Zhao in 2017 and is currently available in multiple languages, including English, Chinese, Japanese, and Korean. Binance allows the trading of cryptocurrencies such as Bitcoin, Ethereum, Litecoin, and many more. The exchange is known for its low trading fees, high liquidity, and security. In fact, the Binance team claims to store over 90% of their user funds in cold storage, making them a very secure exchange platform. Binance is a unique exchange because it offers its users a variety of trading options. Unlike other popular exchange platforms, Binance does not restrict its users to trading one type of cryptocurrency, such as Bitcoin or Ethereum. Instead, Binance offers multiple cryptocurrency trading pairs, such as BTC/USDT and ETH/USDT, which allow users to trade a variety of digital coins. This makes Binance a popular exchange platform for experienced and beginner cryptocurrency investors. Binance also offers its users the option to create a cryptocurrency trading fund, or a token portfolio, through its Launchpad platform.
Benefits of Binance
There are many benefits associated with trading cryptocurrency on Binance. Here are just a few:
- Low Trading Fees - Trading fees on Binance are very low, making Binance a very cost-effective cryptocurrency exchange. There are no trading fees for Binance users who have their cryptocurrency in their trading account for at least 8 hours. Traders who prefer to use a limit order, which is an order to buy or sell a certain quantity of cryptocurrency at a specified price, may incur a small fee.
- High Liquidity - Liquidity refers to the ease at which a cryptocurrency can be converted into cash. Binance has a very high liquidity for all of its listed cryptocurrencies, which makes it a safe and secure exchange platform.
- Large Trading Volume - Binance is one of the highest-volume cryptocurrency exchanges in the world, allowing investors to easily convert their cryptocurrencies into cash.
- Security - Binance is known for being a very secure and reliable exchange platform. The Binance team has taken many precautions to ensure their users’ funds are safe. In fact, they claim to store a majority of user funds in cold storage, making it a very secure exchange platform.
Safety and Security of Binance
Many investors are curious about the safety and security of Binance, especially since the platform has become so popular. Fortunately, Binance has received many positive reviews from users, as well as third-party rating sites, since the company launched in 2017. The Binance user interface is very easy to navigate and is suitable for both beginner and experienced cryptocurrency traders. In fact, many Binance users prefer trading on this platform because of its simplicity and ease of use. In order to protect their users’ funds, the Binance team has implemented multiple verification levels and also offers two-factor authentication to make their exchange even more secure. Here are some features and precautions that make Binance a very secure exchange platform:
- Variety of User Verification Levels - Binance offers several different verification levels to its users, which is important for security. The verification levels include basic, enhanced, and extended levels. The basic verification level requires users to submit their name, email, and country of residence. The enhanced verification level requires a user to submit government-issued identification, such as a driver’s license or passport. The extended verification level requires a user to submit an identity verification letter and a selfie.
- Two-Factor Authentication - Binance offers multiple two-factor authentication methods to its users, including SMS, Google Authenticator, and the Binance Mobile App.
- Funds Held in Cold Storage - Binance stores a majority of its user funds in cold storage, which is a type of offline storage that is more secure than online storage. Binance only keeps a small percentage of its funds in hot storage, which is online storage.
Potential Risks of Buying Cryptocurrency on Binance
While Binance has received many positive reviews, there are also some potential risks associated with buying cryptocurrency on the exchange. Here are a few:
- High Volume of Users - Since Binance has become very popular in recent years, the exchange has a high volume of users, which results in a very high trading volume. While this is a positive sign, it can also lead to longer processing times for withdrawal and deposit options.
- No Customer Support - The only negative reviews Binance users report is a lack of customer support. The Binance team has made it clear that they do not provide customer support for a variety of reasons. However, the Binance team does respond to any concerns or questions posted by users on social media.
- New Authentication Methods - While Binance is known for being a secure exchange platform, the company has implemented new authentication methods that require users to create new login information. While this is a positive precautionary measure, some users have reported that it has taken them several days to receive their login information after requesting a reset.