Binance Announces Launch of Bitcoin-Pegged Token (BTCB)
According to a blog post on the Binance website on June 17, 2019, the cryptocurrency exchange giant announced plans to launch BTCB, their Bitcoin-pegged token.
The pairing is the beginning of a string of similar crypto-pegged BEP2 token pairs for trading on the Binance DEX platform, per the announcement.
First BEP2 Token Backed 100% by Bitcoin
The Malta-based cryptocurrency exchange Binance is set to launch the first BEP2 token trading pair which would be wholly pegged to the number one virtual coin, bitcoin. Before the announcement, the exchange’s CEO, Changpeng Zhao (CZ), tweeted that 9,001 BTC would be transferred for a useful purpose.
CZ also emphasized the reason behind creating such tokens on DEX. Adding:
“The main benefit of offering crypto-pegged tokens is that, obviously, this makes available to Binance DEX traders the many coins that have their own blockchains and aren’t native on Binance Chain.”
Also, the introduction of crypto-pegged tokens would draw traction to the DEX platform, thereby maintaining its standard, as stated thus:
“With the increase in the selection of tokens available on Binance DEX, there should be an increase in trading volume and liquidity. This would further increase the utility value of Binance DEX.”
Back in April 2019, BTCManager reported the successful completion of the BNB mainnet swap after Binance burned five million ERC-20 tokens, thereby launching Binance DEX.
Additional details on the pegged token reveal that there would be a price spread for traders of 0.1 percent with large buy orders on Binance.com. Also, conversion from pegged tokens to native cryptocurrencies is made easy, and there is an assurance of a constant 100 percent backing.
Maintaining Transparent Administration
According to the announcement, crypto-pegged tokens offer transparency and trust, compared to tokens backed by fiat. To further bolster this asset, the exchange platform made the BTC reserve address public to anyone who wanted to track transactions.
Binance also underlined that its BTCB is fully transparent by stating that it is nothing like the “traditional bank balance tether.” It is no news that the most famous stablecoin, Tether, has come under heavy criticisms lately after reports revealed that USDT was not 100 percent backed by USD as earlier claimed.