Despite the cryptocurrency market tanking over 70% since the start of 2018, the world’s largest cryptocurrency exchange is on pace to generate between $500 million and $1 billion in annual profits.
In one year, Binance went from 2 million users (end of 2017) to over 10 million active users. This rapid growth and massive revenue stream has allowed the exchange to surpass many major banks. Binance was started in 2017 after raising $15 million through their Initial Coin Offering (ICO). The activity on the exchange peaked last year with over $11 billion in trade volume per day.
Binance’s CEO, Changpeng Zhao, said in an interview with Bloomberg that he expects Binance to generate at least $500 million in profit in 2018 alone. The best case scenario has the exchange making over $1 billion in annual profits.
The cryptocurrency exchange has grown rapidly, having hit 10 million users already this year, generating $1.5 billion per day in trade volume. Binance makes money off both the sale of BNB (Binance Coin) which can be used to make trades at a 50% discount of 5% instead of 10%, as well as through the exchange fees collected.
Now their $100,000 fee for listing a new cryptocurrency makes sense. The worlds largest exchange has only been online for a little over a year, so their growth is staggering.
Binance’s Expansion Plans
Many forget that the crypto exchange is only one year old, kickstarting its business through a $15 million ICO last July. The company’s youth only makes its staggering growth statistics even more impressive.
In March, Binance opened offices in Malta due to mounting regulatory pressure from from Asian governments. Upon the firm’s announcement, Maltese governmental employees immediately issued statements on social media to welcome the exchange with wide open arms.
Executives at the exchange explained that operations in Malta would help the company secure the proper licensing required for fiat to cryptocurrency transfers, which they have been working on for some time. This would also make them an even larger competitor to US-based CoinBase.
The move to Malta has already been proven as a success, with Binance Uganda, the first fiat to crypto portal, opening late last month. The company has made it clear that this is just the beginning, reiterating its plans to secure banking licenses on a global scale.
Binance has become a hot topic in cryptocurrency circles due to its rising success, with growth culminating in the near quadrupling of the satoshi value of the exchange’s in-house crypto BNB.
BNB’s performance surprised many, as it was one of the only cryptocurrencies to grow substantially against relative Bitcoin value in this bearish trend. This growth may indicate that investors see even more potential in the platform, which is now the 17th largest cryptocurrency by market capitalization.
One thing is clear, Binance is not going anywhere. As of writing this article, they are the #1 largest cryptocurrency exchange as ranked by CoinMarketCap.com by trade volume, with over $1.3 billion in trades in the last day. Binance’s ambitious plans will be quite interesting to watch unfold.