What is BNB?

BNB is the coin created by Binance, the crypto exchange. It pays transaction fees on BNB Chain, a group of blockchains that grew out of Binance, and its supply is reduced over time by destroying coins.

Where it came from

BNB was created in June 2017 and sold to the public in a token sale that July, with a maximum supply of 200 million. It began life as a token on Ethereum and later moved to Binance's own blockchains.

BNB Smart Chain, the network where most BNB activity now happens, launched on 1 September 2020.

How it works

BNB Smart Chain runs smart contracts in the same way Ethereum does, so applications built for Ethereum work on it with few changes.

It is secured by a system its developers call proof of staked authority.

• 45 validators are active at a time. They are chosen each day by how much BNB is staked with them.
• The 21 with the most stake are more likely to be picked to produce blocks.
• A validator must stake at least 2,000 BNB of its own.

Blocks arrive every 0.45 seconds. The set of validators is small, far fewer than Ethereum has.

Supply

No new BNB is created. Validators are paid from transaction fees.

Supply only falls, through burns:

• A quarterly burn. The amount is set by a formula based on BNB's price and the number of blocks produced. In the burn on 15 July 2026, about 1.6 million BNB were destroyed, leaving about 133.2 million.
• A share of every block's fees is burned as well.

The stated target is to bring the supply down to 100 million.

What people use it for

• Paying fees on BNB Smart Chain and its sister networks
• Staking with validators
• Voting on changes to the network
• Lower trading fees on the Binance exchange

Risks to know

• It is tied to one company. BNB's uses grew out of Binance, and trouble at Binance reaches BNB. In November 2023 Binance pleaded guilty to US charges including anti-money-laundering failures and agreed to pay about $4.3 billion. Its founder also pleaded guilty and resigned as chief executive.
• Few validators. With 45 active validators, block production is in fewer hands than on Bitcoin or Ethereum.
• Burns do not set the price. A falling supply does not guarantee demand.
• Smart contract and bridge risks apply here as on any network. Lessons 33 and 45 cover them.

Learn more

Lesson 9 explains coins and tokens, Lesson 12 explains how exchanges work, and Lesson 13 gives a checklist for choosing one.