Updated: May 15, 2021
Only 165 days after its founding date, in July 2017, Binance had become the #1 cryptocurrency exchange worldwide in terms of the trading volume. How did it happen so fast? From the company culture and organizational structure to the decentralized nature of its operations, the unconventional approach adopted by Binance has paid off.
Here are 7 Growth Hacking Strategies Binance used to establish itself as a key player in the blockchain space:
1. The Role of Binance Coin (BNB):
BNB is the native token of the Binance blockchain, powering its ecosystem. The token has many use cases: from fueling transactions to paying fees, and so on.
The image below provides a comprehensive overview of multiple use cases for BNB.
Especially initially, the savvy use of the BNB token provided Binance with an edge over its competitors. Arguably, Binance was the first exchange with a token that actually had some utility, as it allowed users to pay 20% less trading fees than other tokens.
The pivotal role the BNB token has within the Binance ecosystem is clear, given that all new branches have been built with a central role for BNB, to incentivize real use of the token. Further partnerships and strategic agreements have expanded the realm of uses. It is now possible to use BNB to get passive returns, to hire freelancers, to pay in shops, and even to buy land or gaming items.
Last but not least, Binance plans to burn BNB tokens in each quarter, based on the volume of the exchange, until 50% of the total supply is burned. This ensures the token is always in high demand and reduces inflationary pressures.
2. User Referral Fees
With no doubt, this was the most successful user acquisition strategy at Binance. In 2017 it was impossible to surf cryptocurrency forums and subreddits without finding anyone inviting you to Binance, an unknown exchange back then.
Referrals are in no way a novelty, as they have been employed by many companies, starting from PayPal (giving 10$ to acquire users) to AirBNB (one of the most successful referrals campaigns out there). Referrals set Binance aside from its competitors and transformed users into de-facto brand ambassadors. In fact, users inviting their friends would get 20% of their trading fees back in rewards, leading to a frenzy to invite as many friends as possible. Such a great use of incentives and game theory.
Furthermore, Binance wisely combined its native tokens and referrals to incentivize users even more: users keeping >500 BNB on their account would be able to get up to 40% trading fees from users they invite. Recently, they also introduced the possibility to share some of the 20% referral bonus with invited friends.