You are currently viewing A Complete Guide to Understanding How to Use Binance

A complete guide to understanding how to use Binance

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Are you trying to dip your toes into cryptography for the first time or you have found that legendary one altcoin and do you need to go through Coinbase to get it? If this has happened to you before, you may be looking for an Exchange that gives you access to hundreds of altcoin and trading pairs. An Exchange that gives you more options to deposit dollars, pounds, euros ... maybe, and just maybe, maybe you are also interested in having the possibility to trade Futures to earn interest on your cryptocurrency. Maybe you even want to get one crypto Visa card. Maybe maybe you want to take part in one of those mysterious IEOs (Initial Exchange Offering) that someone told you about .. that you read somewhere .. good news everyone! There is this phantom Exchange that offers all this and much. Indeed, it is the number one cryptocurrency exchange in the world: Binance.

I write a definitive guide for beginners to using Binance. Step by step, how to buy Bitcoin with normal fiat currency, we will see how to trade on the Exchange and give you a complete overview of the other main features of Binance. We'll also look at how to get a 40% trading fee discount so you can keep as many of those crypto gains in your wallet as possible.

Are you new here? Welcome!

Here at cazoo my goal is to memorize, by writing it, the information I collect daily online, because this has always been my study method. If I write it, I remember it. Instead of just doing it in word, I do it here, so I can maybe help someone else with my notes. I will talk to you talking to myself, as if it were a diary.

As everyone says I'm not financial advisors maybe it's worth covering your butt, and then I'll say it too: I am not a financial advisor, I'm not telling you how to invest your money and I would never allow myself to.

Ready to learn everything about Binance? FIG.

Index

Who is Binance?

Let's take an overview of Binance as a company? After all, it's probably a good idea to know who you're dealing with before depositing money on their platform.

First point against: no one really knows where Binance is headquartered. Many say Malta, however about a year ago the Maltese regulator responded in person to say that Binance is not under Maltese jurisdiction. Anyway, is it really a problem? Interested in knowing where Bitcoin is based? These are cryptocurrency companies. Perhaps it is better not to judge them as you would with a traditional company. After all, Binance is global and has staffed offices around the world in around 50 countries.

Are the Binance guys hiding too? I would say no: among them is the legendary founder and wizard of finance Changpeng Zhao, better known as CZ, who participates in many interviews, writes often on Twitter and even one day appears on the cover of Forbes magazine. According to this magazine, CZ appears to be the fifth richest person in cryptocurrency with a net worth estimated at a staggering $ 1,9 billion.

https://pbs.twimg.com/media/DxEcsH0U0AAL9x6.jpg
Changpeng Zhao on the cover of Forbes

Launched in 2017, after a successful ICO that raised $ 15 million in which investors obtained BNB tokens in exchange, at an initial value of around 10 cents. Today BNB is hovering around $ 250 .. not a bad return on investment for those who have trusted CZ from the start. In 2019, Binance generated around $ 570 million in profits, and at the end of 2020 the Exchange alone had around $ 1 billion in profits. Also in 2020 Binance has acquired the supplier of cryptographic cards Swipe, a project worth approximately $ 200 million. It also recently acquired coinmarketcap.com for $ 400 million. Other strategic investments include the FTX Exchange, whose token is one of the top 40 cryptocurrencies and has a value of around 2 billion market capitalization.

This one that I just listed is not an exhaustive list of everything Binance has strategically invested in, but I think you understand that the Binance Exchange is not exactly a project run somewhere in the basement. No, it is the most successful Crypto Exchange on the planet, led by a founder who achieved in three and a half years what would take most billionaires a lifetime and, what's more, Binance has no plans to slow its expansion. so much so that if their intentions were malicious… they would have a lot to lose.

Binance also has a proven track record of doing the right thing - you may already know they were hacked in 2019, where roughly 2% of Bitcoin holdings on the Exchange were lost. However, Binance fully reimbursed all those affected by that hack drawing funds from the SAFU fund (Secure Asset Fund for Users) which is a cauldron of cryptocurrency set aside to cover things like hacks.

I would say we got a good overview. Let's go ahead and see how to find out if that altcoin you so desire is actually listed on the Exchange. After all, what's the point of setting up an account if what you're looking for isn't there. Now I'll tell you a trick to understand in which Exchange any cryptocurrency is traded.

Does Binance cover all crypto that interest me?

To do this you can go to coinmarketcap.com, click on the search and type in the crypto you are interested in. In this case I used Avalanche. Once you click on Avalanche you will see a statistics page with a series of metrics and a price chart. If you look above the price chart you will see a bunch of different options and one of them will be a Market button. Click on that little guy and you'll soon see all the different exchanges that Avalanche is listed along with the different exchange pairs available.

Let's see: AVAX can be purchased on Binance with USDT, BTC, EUR, BUSD and BNB tokens. Also keep in mind that Binance generally has the highest trading volume for almost all supported cryptocurrencies, so most people who trade the currency in question do so on Binance. Either way, you can replicate that method for any cryptocurrency to find out where to buy it.

Joining Binance is really simple, there is no point in writing step by step what to do, I trust that you will use a password that is really difficult to guess, and make sure you have set up two-factor authentication using Google Authenticator. Security is never too much!

We now deposit fiat currency, i.e. euros or dollars, on Binance.

We now deposit fiat currency, i.e. euros or dollars, on Binance

At the top is the Buy Crypto button, buy cryptocurrency. After clicking it you will see a list of all the different fiat currencies. What's really cool about Binance is that some of these deposit methods are commission-free, so you're basically getting the most for your money. Throughout Europe the bank transfer, therefore the SEPA deposit, is a zero commissions , while if you prefer to use your credit card to make that deposit on Binance both Visa and Mastercard, you will be charged 1,8% per euro. I don't want to pay commissions. Just be careful of one thing when using bank transfer: you have to use the same payment reference code, the payment reference code, which you see in Binance. This way Binance knows it is the Your deposit and which will be assigned to Your account. Once your deposit has been processed and you have euros in your Binance account, you can go back to the Buy Crypto tab and select Cash Balance from the drop-down menu.

On the following page you can enter how and which cryptocurrency you want to buy. Binance also shows you how much cryptocurrency you will receive .. basically that's all there is to it.

What if you already have some cryptocurrency and want to join that altcoin buffet on the exchange?

Depositing Crypto on Binance

To deposit crypto into your account, log into your account and click on the wallet button at the top right of the screen. This will expand a drop-down menu and we are interested in the item Fiat and Spot. Enter there. You will be taken to this screen:

Then click on the button Deposit, and the first page that will appear will be a deposit page for Bitcoin with its BTC address. If you want to deposit BTC that is the address you can use to send Bitcoin to Binance. However if you have a altcoin you want to deposit instead you can simply click on that Bitcoin button to expand a drop-down menu and search for the crypto you are interested in. Here for example I have chosen Cardano.

We said that there are commissions for trading: now I'll explain how to pay them a little less. I also have some suggestions on where you can find Binance promotions, and some are not to be missed.

How to save on commissions

Commissions seem like a formality, but they always have to be added up .. and when they become a lot in the long term they will make themselves heard, so listen carefully.

First of all: there are two types of cryptocurrency trading fees, the first is the Taker Fee which applies when you place an order at the current market price. The second is the Marker fees, which you pay when you provide liquidity by entering things like a "limit order". I am sure that Taker Fees will be paid for the operations you want to do, so let's focus on these.

Both Taker and Maker fees start at a 0,1000% commission. There are several ways to reduce those fees further. The first is by trading more than 50 Bitcoins in 30 days… an almost unattainable trading volume. Alternatively you can keep more than 50 BNBs in your account for a slightly reduced Maker Fee of 0,0900%. 50 BNB, right now, is about € 11.100, so it's still a princely sum.

If you want a discount on Taker Fees, you will need to exchange 4500 BTC in 30 days or have 1.000 BNB in ​​your account. Yep, that's more than 220.000 in crypto BNB. How many have all that money aside?

So what I recommend is to always keep some BNB in ​​your account and use that to pay trading fees. Do that, and you'll automatically get 25% off those fees and pay only 0,0750%. and yes, you can save even more! You must use this my link with referrals, and you can get another 20% off those trading fees.

So if you are opening a new Binance account now you can do two very simple things: buy some BNB to pay for trading fees, and sign up using my link. If you do, you can start trading forever reducing commissions by 40%, from 0,1000% to only 0,0600%.

Virtually no one talks about the fantastic promotions on Binance found on the home page.

The promotions on the Binance Home Page

Most of these promotions are geared towards crypto-junkies, those who go into abstinence without crypto. But it's still worth going through them and seeing if any of them have a value that interests you.

For example, if you wanted to trade REEF crypto, there was a $ 50.000 REEF competition. While these prizes often go in the direction of strong traders, there is a lottery element to many of the promotions: in this trade competition with REEF crypto, 20 lucky people who had traded with REEF were randomly chosen to get 500 as a gift. $ of REEF. Throw them away.

Okay, now you know about commissions and promotions. Let's start talking about actual trading on Binance.

How to trade on Binance?

So there are several ways to trade on Binance. What is the simplest way? As usual, make sure you are logged into your Binance account, then click Trade from the top menu bar, and select Convert.

You will come to a screen where you can select the cryptocurrencies you want to convert and select the amount you want to trade.

Cryptocurrency Conversion

Let's pretend we want to trade 1 ETH in Bitcoin.

Just enter it by clicking on Preview Conversion. You will see the price quote and attention, you have a few seconds to accept that price. Once done, you have completed the trade. Very easy.

The downside to this method is that there are only a limited number of trading pairs and it only supports market orders, which means you have to rely on the market price at that precise moment.

If you want more flexibility, you can get it in the classic trading panel: in the navigation bar at the top, Trading and then Classic.

You will then see a trading screen like this and you are probably thinking "Damn. I knew it was going to be complicated". Take a step back! And don't panic. I promise you it's not as complicated as it may seem at first glance.

The advantage of using this type of trading interface is that it can allow you to place more advanced order types, which can save you a lot of money and a lot of time.

To understand what is happening with this trading interface let's divide it into sections.

Binance Order Book
Order Book, register of orders

On the left is the Order Book, the order book, All those red numbers at the top are sell orders for a particular cryptocurrency and all the green ones are buy orders. All those orders are made at different prices. The left column in the order book is the price at which people have placed buy or sell orders. The middle column is the amount of cryptocurrency available for certain selling price values, and finally we have the right column in the order book which shows the dollar value available in different selling price values. In the center of the screen you can see a price chart.

Filter at the top by time frame

You can filter it according to different time frames and you can also click on the small arrow to view the tools of the chart, if you are interested in doing technical analysis. We could talk more about it .

Open the chart tools below

At the top right of the trading panel you have all the different trading pairs available on Binance. With the search function you find the cryptocurrency you want to trade (trade, English speakers say). Now I am looking for the ticker ADA, of Cardano, and as you can see different trading pairs come out. I know, you have two questions.

Search for the ticker you want to start trading

First, what the heck do those 10x and 5x or 3x symbols mean next to some of those ADA trading pairs? They just mean that you can trade with leverage of ten or five or three through the Margin trading: that's where you borrow funds to trade with leverage, to amplify your earnings (and losses).

Seriously, are you just getting started? Ignore leveraged trading totally, let experienced traders use it or study to become an experienced trader and you can fully understand the risks.

The second thing you are probably wondering is why I searched for ADA instead of looking for Cardano. Indeed, if you Czech Cardano, nothing comes out. The reason is that trading pairs use shortened versions of cryptocurrency names, called tickers. It is usually a combination of three or four letters. And how do you find the ticker for the crypto you want to buy? Go to coinmarketcap and search for the crypto you are interested in. The ticker will appear to the right of the cryptocurrency name.

Cardano ticker on coinmarketcap

You can thus find the ticker for any cryptocurrency. Let's go back to that trading panel.

Market Trades, exchanges on the market

In the lower right corner you have the Market Trades, i.e. the trades on the market. Only the most recent trades that have been made are shown.

And finally, you have the section of the trading panel where all the magic happens and where you enter all the important orders.

Trading panel

By default this order menu will be set to Limit Orders. The best way to explain what they are is to use an example: let's say that in your opinion the price of Bitcoin is now too high, and you would be happy to buy when it returns to 40.000. You can place this order on Binance - you will have to type in that price of 40.000 and choose the amount of Bitcoin you want to buy. By pressing the green Buy button that order will be added to the order register. If you are sleeping tomorrow night and the BTC price drops to 40.000 on Binance, then this limit order will automatically trigger and you will get your BTC at this lowest price.

Did you understand how limit orders are used in crypto trading? Perhaps it would be worth using these Limit Orders instead of Market Orders.

It is also important to note that limit orders use Maker Fees as a commission, and not Taker Fees, which can sometimes be cheaper on Binance. Limit orders work exactly the same on the sell side: I could place a limit order for one bitcoin if the price reaches 100k - that order will stay there and do nothing until the price is reached.

Obviously, these orders are always cancellable. You can also set that the order should only be active for a certain period of time but this is a topic for another article.

Market Order

Market Orders are the simplest order types: you are simply entering an amount you want to buy and taking the market price when placing the order.

The only thing we don't talk about is Stop Limit Orders, I can't explain that well.

Stop limit Order

But if you've been careful, you should now know the basics of how to buy and sell cryptocurrency using Market Orders and Limit Orders. There is another thing to avoid: Futures.

Derivatives - Futures

It is even more risky than Margin Trading. Futures can be a useful tool when used responsibly by professional traders, but newbies like you who want to trade volatile altcoins with 125x leverage… are not responsible people. If you insist on trading with leverage, then you might consider Leveraged Tokens, which give you moderate leverage and eliminate the risk of being liquidated .. so a decent trade-off. We should talk about this too tomorrow.

We have seen the basic trading functionality on Binance.

However this is just one of the many services offered on this massive cryptocurrency buffet, so let's take a look at what else is on the menu.

Other services on offer?

With all this circulation of new banknotes around the world, you too have a laughing interest in your funds. Well, Binance Earn gives you the ability to earn interest rates of around 6% APY (Annual percentage yield) on some crypto currencies.

Binance Earn - Flexible Terms

You can choose to opt for flexible savings, which means you can access your crypto at any time, or you can block that crypto for periods of up to 90 days to get a slightly higher interest rate.

Binance Earn - Fixed Terms

High-risk savings products are available for even higher rates, but keep in mind that you are taking more risk to get more return.

Binance Earn - High Risk Products

The reason these interest-generating products are so popular is that many people keep cryptocurrencies in a wallet and sit there doing nothing. Instead, other people take a portion of their holdings to earn interest while they wait for cryptocurrency prices to explode and hit their desired price.

Another hot product that Binance offers is their crypto visa card.

Binance Visa Crypto Debit Card

But why on earth would you want to have one?

Let's face it, converting cryptocurrencies and withdrawing that money from your bank can be a hassle. Also, it's cool to think about giving yourself something, if it didn't go that bad .. so if you care and want to be able to spend your crypto wherever Visa is accepted, then a Crypto card is what you need. The card is available in a myriad of countries around the world. That beautiful black Binance card is completely free, and Binance itself doesn't charge you any processing or administrative fees. That card also connects with your Binance Exchange account! And also, you can get up to 8% cashback when you use that card so yes if you are lucky enough to be able to get a binance card then you might want to grab one now.

I don't recommend that you do this, but Binance also offers collateralized crypto loans if you want.

Crypto Loans

The most direct way to describe it is that it's a bit like getting a loan at a pawnshop, where you provide collateral in the form of an item that has value (like a watch, for example) and get cash on loan. On Binance you can get an initial Loan to Value (LTV) ratio of 55% and you will be asked to add more cryptocurrencies to secure your loan if the LTV rises to 75%. If the LTV hits 83%, your crypto collateral will be sold by Binance to cover the loan .. you certainly don't want that to happen.

What most people do with these loans is buy more cryptocurrencies which is a form of leverage, but anyway, if you are interested, with this tool you can provide collateralized cryptocurrencies and even borrow pounds euros or US dollars. . if you want.

Then there is a feature known as Binance Liquid Swap which is another way you can generate passive income with cryptocurrencies and potentially earn a high return. Still keep in mind that it carries risks!

Binance Liquid Swaps

Another feature offered by Binance is its Launchpool. Basically this product allows Biannce users to generate tokens as a reward in exchange for staking certain cryptocurrencies. Some cryptocurrencies like Litentry have never had a public sale or Initial Exchange Offering at all, and instead distributed a portion of the initial token using the Launchpool.

Binance Launchpool

The last product I want to talk to you about is the Binance Launchpad: it is Binance's exclusive platform for launching crypto projects.

Binance Launchpad

It's also where guys like us can get token allocations at very, very favorable prices .. for popular projects on the Launchpad the token allocations are typically done through a lottery system - to put it down easy, the more BNB coins you have in your account. Binance, the more lottery tickets you get. If you win the lottery, you have the right to purchase a specific altcoin for a fixed price. So, provided you pick a solid project and are lucky enough to get an allocation, chances are you will fare pretty well as soon as public trading goes live on Binance. This is why almost all the projects that have been launched on the launchpad have been chronically subscribed by so many people, which is why that lottery system has been implemented: it was binance's attempt to make these allocations fairer and fairer. . It is also not as if binance shares these Initial Exchange Offerings with other exchanges, so if you see a project on the launch pad that opportunity will be exclusive to Binance. It's worth flying over that launch pad to see if anything teases ...

We're almost done. Just a few more words to talk about some of the educational resources Binance offers for free.

Educational resources

The first is Binance Academy, which provides some fantastic resources on different cryptocurrencies and topics related to cryptocurrencies. The second is a very underrated thing: it is Binance Research. Here you can find resources related to projects with all kinds of statistics and graphs, which deal with listing the supply of tokens of a given project, the token allocation that is their distribution, distribution release schedule and much more. Take a look, it's very simple to read.

Binance Research

The guide is over ... but the truth is that I have just scratched the surface and that Binance offers so much more than it can tell in one article.

If you're interested in getting started on Binance, don't forget that special 20% trading fee discount by signing up for free via the referral link.