eToro has issued a detailed report related to Binance Coin (BNB) and whether to consider it a security or a utility token. The U.S. Securities and Exchange Commission (SEC) has been working in order to understand how to better consider virtual currencies. According to the report, it is not easy for BNB to be classified as a utility token or as a security.
Binance Coin, a Security or a Utility Token?
Binance is the 16th largest crypto in the market. With a market capitalization of $708 million dollars, this virtual currency attracts the attention of many investors. However, it might not be easy to consider this virtual currency a security or a utility.
According to the recent report released by eToro, the BNB token can be used as a medium fo exchange, even when this was not the main use intended at the moment of its creation. Although the currency does not provide an exclusive access to the Binance platform, it gives several benefits for traders.
Nonetheless, the value of the BNB coin is clearly tied to how the cryptocurrency exchange Binance would behave.
The report reads as follows:
“It is not always easy to classify a coin into one or several of the categories above. In the case of BNB, it can indeed be used as a medium of exchange, but that is arguably not the main use that was intended for the currency upon its creation.”
It is important to mention that just a few days ago, Binance Coin has been accepted by BitTorrent as a means of payment. This shows that there is a real use case as a means of payment by BNB, but it can also be classified as a security. Although this is a very important decision taken by BitTorrent that improves BNB’s market presence, it still depends on Binance and how it will evolve.
Binance is one of the largest and most important cryptocurrency exchanges in the market. In the last 24 hours, the platform handled $1.25 billion dollars in trading volume. In the future, the platform aims at creating a decentralized exchange (DEX) that focuses on user-friendliness. Binance Coin is expected to be the base coin for this exchange.
Additionally, Changpeng Zhao, Binance founder, has also been doing everything as possible for the trading platform and virtual currency to grow.
At the time of writing, each BNB coin can be bought for $5.4.
Check out the BNB Price Prediction and Technical Analysis article. Interested readers should also check out our coverage of Binance Coin in articles exploring its ‘gas’ use for Binance’s decentralized exchange, or how BNB price rose in relation to the exchange’s expansion.