Following on December 22's Kaminska on Crypto: "Does Changpeng Zhao know Binance will implode?".
From Dirty Bubble Media, January 6:
Is the Binance Smart Chain the OneCoin scam with extra steps?
For a brief time, Dr. Ruja Ignatova was one of the most well-recognized figures in the cryptocurrency industry. Her product, OneCoin, was advertised as the “Bitcoin killer.” Using multi-level marketing (MLM) tactics, OneCoin managed to pull in billions of dollars from investors over a couple of years. Unfortunately, there was a major problem with Ruja’s narrative: OneCoin had never actually created any blockchain technology. It turned out that the tokens they were selling didn’t even exist in the ephemeral “it’s on-chain” sense; these were literally nothing more than numbers on a screen.
Of course, crypto detractors would argue that there is little difference between the OneCoin scam and other cryptocurrency offerings. In both instances, investors receive nothing more than digital trinkets with no claim of practical significance. However, it is fair to say that blockchains offer certain advantages. A blockchain is a decentralized and immutable record of every transaction completed on the chain, allowing for a high degree of confidence in the records on said chain. Users of the blockchain can trust that the records are accurate because no one entity controls the records and it is impossible to alter those records. At a minimum, when purchasing a “real” blockchain token you at least know your asset is being tracked on a secure and accurate ledger.
The most egregious part of the OneCoin scam wasn’t the standard “fraud” and “pyramid scheme” aspects that are shared with so many other crypto products. It was the fact that OneCoin didn’t even meet the minimal standard of selling a “real” cryptocurrency.
In 2019, Binance created its own alternative to compete with the dominant Ethereum blockchain. Binance copied the code from two previous blockchains, Cosmos and Ethereum, to create an integrated pair of chains commonly referred to as the “Binance Smart Chain.” The Binance Smart Chain is “proof-of-stake,” meaning that validators (the transaction processors/recorders) must buy and “stake” the blockchain’s governance token to become validators and receive transaction fees. One chain, called the Beacon chain, serves as the “governance” portion of the Binance system. The second chain, the BNB Smart Chain, hosts smart contracts and the majority of the actual activity running through the Binance chains.
This might seem complicated. A “tradfi” way to think of it: Being a validator is like owning stock in a company. To get dividends from the company, you must also lock your shares up in an escrow account (“governance”).
Binance issued the “BNB” token to serve as the governance token for validators on the Binance Smart Chain. Subsequently, BNB’s price skyrocketed with the market cap for the token maxing out around $110 BILLION in 2021. Today, BNB is roughly 62% below its all-time high. While this might sound bad, BNB has actually outperformed most other cryptocurrencies. For example, Bitcoin is 76% off its ATH, while Ether is 74% off ATH.
The Binance Smart Chain and BNB are cornerstones of the Binance empire. However, recent analyses have called almost every aspect of this blockchain into question. It turns out that, like many things with Binance, a closer look reveals cracks within the façade. The vast majority of BNB tokens appear to be owned directly by Binance, and market analysis suggests that the price has been artifically inflated. Billions of dollars in purported stablecoins pegged to the U.S. dollar on the BSC were not backed with real assets for weeks at a time. The code base for BSC is not open source and appears to be controlled directly by Binance employees. And most importantly, a deep dive into the Binance Smart Chain suggests that it might not function like a blockchain at all…
Binance owns 70-80% of BNB market cap, and the price appears to be manipulated....
....MUCH MORE
