Crypto Gloss

Binance

Definition: Binance is the world’s largest cryptocurrency exchange by trading volume, founded by Changpeng Zhao (CZ) in 2017. It offers an expansive ecosystem including spot and derivatives trading, a native blockchain (BNB Chain), a launchpad for new tokens, and staking services — though its history is marked by regulatory clashes worldwide.

Key Features

  • Spot trading — 350+ trading pairs with deep liquidity
  • Futures & derivatives — Perpetual contracts, options, and leveraged tokens (up to 125x on some pairs)
  • Binance Launchpad — Platform for new token launches (IEOs)
  • Binance Earn — Staking, savings, and DeFi yield products
  • BNB Chain — Native L1 blockchain with low fees and EVM compatibility
  • Binance Pay — Peer-to-peer crypto payments
  • Binance Academy — Free educational content on blockchain and crypto
  • Binance NFT — NFT marketplace integrated into the exchange
  • Copy trading — Follow and replicate trades from top performers

Supported Assets

Binance lists 600+ cryptocurrencies and supports 50+ blockchain networks for deposits and withdrawals. It consistently has the widest asset selection among centralized exchanges.

Security & Audits

  • Secure Asset Fund for Users (SAFU) — emergency insurance fund established in 2018, holding ~$1 billion
  • Multi-tier and multi-cluster system architecture
  • 2FA, address whitelisting, and anti-phishing codes
  • Published Merkle-tree-based Proof of Reserves (criticized by some auditors as insufficient)
  • Major hack (2019): 7,000 BTC (~$40M) stolen via phishing and malware; covered by SAFU fund with no user losses

Fees

Action Fee
Spot (maker) 0.10% (lower with BNB discount)
Spot (taker) 0.10% (lower with BNB discount)
BNB fee discount 25% off trading fees
Futures (maker) 0.02%
Futures (taker) 0.04%
Withdrawal Varies by coin and network

How to Sign Up

  1. Visit binance.com and click “Register”
  2. Sign up with email or phone number
  3. Complete identity verification (KYC) — required in most jurisdictions
  4. Enable 2FA (authenticator app recommended)
  5. Deposit funds via bank transfer, credit card, or crypto transfer

Note: Binance is restricted or unavailable in the United States (Binance.US operates as a separate entity), the UK, and several other jurisdictions.

History

  • 2017 — Founded by CZ in Shanghai. BNB token launched via ICO, raising $15 million (July). Became world’s largest exchange by volume within months.
  • 2018 — Relocated from China to Malta to escape Chinese crypto ban. Launched SAFU fund.
  • 2019 — Launched Binance Chain and Binance DEX. Suffered 7,000 BTC hack ($40M), covered by SAFU.
  • 2020 — Launched Binance Smart Chain (now BNB Chain), an EVM-compatible L1 with low fees.
  • 2021 — Regulatory pressure from UK FCA, Japan FSA, and other regulators. Began reducing derivatives offerings in several countries.
  • 2022 — CZ’s tweet about selling FTT contributed to the collapse of FTX (November). Binance briefly offered to acquire FTX, then withdrew.
  • 2023 — DOJ charged Binance and CZ with anti-money laundering violations. Binance agreed to $4.3 billion settlement. CZ pleaded guilty and stepped down as CEO. Richard Teng appointed new CEO (November).
  • 2024 — CZ served 4-month prison sentence (April–September). Binance continued operations under Teng’s leadership with increased compliance focus.

Controversies

  • DOJ settlement ($4.3B) — Binance admitted to willfully violating the Bank Secrecy Act and facilitating transactions for sanctioned entities. This was one of the largest corporate penalties in U.S. history.
  • CZ’s guilty plea — The founder personally pleaded guilty to failing to maintain an adequate AML program.
  • Regulatory bans — Binance has been warned, restricted, or banned by regulators in the UK, Japan, Germany, the Netherlands, and other countries.
  • FTX collapse involvement — CZ’s public announcement of selling FTT is widely seen as the catalyst for FTX’s bank run. Whether this was calculated or coincidental remains debated.
  • BUSD termination — The SEC and NYDFS forced Paxos to stop minting BUSD in 2023, eliminating Binance’s branded stablecoin.
  • Proof of Reserves skepticism — Multiple auditing firms distanced themselves from Binance’s PoR reports, citing limitations in scope.

Social Media Sentiment

Binance remains the dominant exchange globally, and r/binance is an active community. Sentiment is mixed: users appreciate the low fees, wide asset selection, and BNB utility, but trust took a significant hit after the DOJ settlement. On r/CryptoCurrency, Binance discussions often devolve into debates about centralization vs. convenience. Post-CZ, sentiment toward the new leadership under Richard Teng is cautiously optimistic.

Related Terms

See Also

Research

  • Binance. (2017). Binance Whitepaper. Binance.
  • U.S. Department of Justice. (2023). Binance and CEO Plead Guilty to Federal Charges in $4.3B Resolution (Press Release, November 21, 2023). U.S. Department of Justice.
  • Makarov, I., & Schoar, A. (2020). Trading and Arbitrage in Cryptocurrency Markets. Journal of Financial Economics, 135(2), 293–319. Elsevier.
  • Cong, L. W., Li, Y., & Wang, N. (2021). Tokenomics: Dynamic Adoption and Valuation. Review of Financial Studies, 34(3), 1105–1155. Oxford University Press.