The CEO and founder of Binance, Changpeng Zhao (CZ), announced that the crypto exchange will issue a new coin. According to CZ, Binance decided to launch an XRP-backed coin on Binance Chain.
The new coin (XRP-BF2) will be developed for Binance’s decentralized crypto exchange ‘Binance DEX’. It is intended to give users of the Exchange a chance to invest in a stable XRP asset. After recently launched Bitcoin-pegged coin – BNTB, XRP will become the second of Binance’s own digital asset pegged to some of the top cryptocurrencies on the Binance Chain.
Actually, the news shouldn’t have been disclosed yet, but because of complete “transparency” by the Blockchain, he tweeted about it. CZ also said that the new Binance Asset will be 100% pegged to the value of XRP.
Binance DEX will offer XRP-BF2 to enable XRP to be traded on Binance DEX referring to wrapped XRP. Meaning you get 1:1 ratio of XRP for (XRP-BF2) simply an easy way for people to use XRP on Binance DEX.
Ripple’s XRP should thus be more in demand
The main use of the new token will be that it will allow traders on Binance DEX to participate in the pricing of Ripple’s XRP. This was not possible on Binance’s main trading platform until now on Binance DEX.
Benefit of offering 1:1 tokens is that it gives the Binance DEX traders the tokens that have their own blockchains and are not based on the Binance Chain.
“With the increase in the selection of tokens available on Binance DEX, there should be an increase in trading volume and liquidity, which would further increase the value of Binance DEX.”
A lot of XRP fans aren’t too excited about the news, but CZ not only sees an advantage for Binance users, but he also hopes for more direct demand for Ripple’s XRP:
“Demand should increase as more use case / trading takes place.”
Binance’s new XRP coin is part of a larger project by Binance. In the long term, Binance plans to introduce a whole range of crypto assets, each backed by one of the top-ten cryptocurrency by market cap. According to CZ one of them will be Stellar Lumens.