Binance is the largest crypto trading platform in the world by daily trading volume. It has about 30 million global users, and does tens of billions of dollars in trading transactions every day. The company was founded in 2017 and was first based in China, until the Chinese government regulated the crypto industry. Binance is now based out of the Cayman Islands and is still under the control of its founder and CEO, ChangPeng Zhao. Can I buy Binance stock?
What Is Binance?
Binance itself is a global platform that is used in over 140 countries around the world. To make matters confusing, Binance is used in every country except the US where BinanceUS is used.
Why did the company spin off the American side of its company in 2019? You might be wondering if it is the same thing that the Chinese social media company, TikTok, did.
Crypto asset and security regulations in the US are stricter than in other countries.
Rather than change its entire platform just to accommodate Americans, Binance just created an entirely new platform for American use. Can I buy Binance stock?
Can I Buy Binance Stock?
As of right now, you cannot. Binance and BinanceUS are both privately owned and do not trade on any stock market. But that does not mean it will stay this way forever!
BinanceUS just completed another round of funding where it received $200 million. This gives BinanceUS a pre-money valuation of $4.5 billion, as the company prepares for an IPO in the near future.
CEO ChangPeng Zhao, or CZ as he is known in crypto circles, confirmed that BinanceUS would be seeking an IPO in the next couple of years.
Investors who want to buy shares of BinanceUS won’t have to wait much longer, it seems. But they should be aware that they will only be investing in BinanceUS, and not the entire company.
BinanceUS does a respectable 24-hour trading volume of about $306 million on average, but it pales in comparison to the performance of the global parent company.
The dynamic between Binance and BinanceUS is interesting. The two platforms have very little in common aside from having the same owner in CZ. Other than that they are not affiliated in any way except for using the Binance name.
BinanceUS is not an affiliate or subsidiary, so Binance won’t really benefit much from having the American segment go public. BinanceUS is a more limited version of the global Binance platform, and part of the money raised from going public will be spent on getting the app up to speed with other crypto platforms in the industry.
Will Crypto Companies be Regulated in the US?
It’s definitely something that has been on the radar of the US government, the SEC, and the Federal Reserve.
While most other countries have just treated cryptos as an asset, the US is looking into regulating the industry.
Could this have an impact on BinanceUS? Of course.
If the regulations are not investor-friendly, then we could see a mass exodus in the US. Other major countries like China and India have regulated their crypto industries to some extent.
Some in the industry believe that the crypto world has simply grown too large and that the US is late with regulation. Others believe that the US is attempting to create its own stablecoin to track the US dollar.
Whatever the case might be, there is the concern for regulation hanging over the US crypto industry. It’s just one of several risks in investing in a crypto exchange these days!
Can I Buy Binance Stock or Invest in a Crypto Exchange?
It’s a valid question at this point given how easy it is for anyone to invest into crypto assets. Why buy shares of a crypto exchange instead of just buying the cryptos themselves? The first reason is simple: crypto assets are far more volatile. Now, this is somewhat of an old myth now, especially when you are talking about Bitcoin or Ethereum.
The blue-chip cryptos are not as risky as they once were. They can still be subject to volatile price action, but there isn’t as much of a chance for these projects to go to zero. Of course, it depends on which cryptos you invest in, but any of the big ones are about as volatile as trading stocks these days.
Buying shares of BinanceUS or any other crypto exchange is an investment in the company, not the industry. The industry certainly has an impact on the company and its ability to attract users. But buying stock in a publicly traded company is specific to that business.
If you believe that BinanceUS can succeed in the future, regardless of the crypto industry, then you will likely see it as a good long-term investment. Crypto exchanges make revenues on transactions and trading fees, so they can continue to make money in any type of market.
Finally, an investment in BinanceUS is an investment in the future of digital assets. As many crypto opposers as there are, there seems to be more supporters these days. From retail traders to Fortune 500 companies, nearly everyone is getting exposure to cryptos in some form. From DeFi to NFTs to crypto gaming, the future of cryptos is bright, and exchanges are at the heart of the industry.
Other Crypto Stocks to Buy
Can I buy Binance stock? No. But there are many other cryptocurrencies you can buy. Trading crypto is a popular subject these days. And one that people take very seriously. If you’re going to trade cryptos, make sure you know how to read the market.
If you can read what
Coinbase (NASDAQ: COIN)
The single largest US-based crypto exchange, Coinbase has traded publicly since April of 2021.
Coinbase is widely used across the world, and it is the most popular exchange for US traders.
With 89 million registered users, Coinbase has a large share of the US crypto trading market.
The company also recently launched its NFT marketplace to compete with OpenSea in another booming industry. Shares of Coinbase are down by over 55% since its IPO, and nearly 70% since its all-time high price of $429.54 per share.
Can I buy Binance stock? Nope but you have other options.
Robinhood (NASDAQ: HOOD)
We all know Robinhood from its role in the meme stock short squeeze in January of 2021. Robinhood also has an extensive crypto trading platform for users, although it pales in comparison to the scope of Coinbase or Binance.
Shares of Robinhood are down just as bad as Coinbase with a 67% loss since its IPO. Robinhood recently became one of the first trading platforms to extend its trading hours. While crypto markets trade 24 hours per day, it appears that Robinhood wants to allow equities trading after the session closes.
Block (NYSE: SQ)
Block is known for its payment systems and Cash App platform that is used by tens of millions of Americans each day. Unlike Coinbase and Robinhood, Block is not a brokerage or trading exchange. It does allow users to buy, sell, and hold Bitcoin in their digital Cash App wallets.
Block has even added features so that users can instantly convert paychecks into Bitcoin. It has also added a top up service to round payments up and use the extra funds added to the total to convert to Bitcoin.
This is all tied in to CEO Jack Dorsey’s strong belief in a digital economy that can be supported by Bitcoin. Block isn’t an exchange, but there are not many companies as bullish on cryptos for the future.
Silvergate Capital (NYSE: SI)
Silvergate Capital is a small bank in San Diego that has been changing the way traditional banks think about cryptos. The company has created a long list of products for its customers to invest in, including cryptos and other digital assets. Silvergate is even leveraging its own patented digital trading software and is offering its banking APIs to other websites. It started to invest in digital assets way back in 2013 and has been profitable for 13 straight years.
Is BinanceUS a Good Investment?
If you need further proof of mainstream acceptance, look at legacy banks like Goldman Sachs and JPMorgan entering the space. Even as recently as five years ago, the thought of these companies entering such a nascent industry would be mindblowing. Crypto exchanges like Binance or Coinbase were a fraction of the size they are now.
The growth of the industry has been staggering. Last year, reports revealed that nearly 30% of American parents have invested or traded cryptos in some way. When we expand this further, over 60 million Americans have exposure to some form of digital assets.
Cryptos are no longer a fringe investment vehicle. With rising inflation and inefficiencies of legacy banking systems, cryptos are being favored by the first generation of the population that was raised by computers and digital systems.
Can I Buy Binance Stock Final Thoughts
Can I buy Binance stock? Not yet. However, BinanceUS will likely be a nice investment when it goes public in a couple of years. While stocks like Coinbase have struggled, it has been more of a case of succumbing to a market correction than poor company performance. The future of mainstream crypto trading will rely on these centralized exchanges, and the Binance brand is the most prominent in the world.