Bitcoin, for example, has a high quantity of geographically distributed nodes and miners and has survived over 11 years of ups and downs. With Bitcoin, you can know with a high degree of certainty that no sole company, government or individual has control. Instead, the collective of its users determines its future, meaning that a free and open market only determines its price.
While Ethereum has half as many nodes as Bitcoin does, it is still orders of magnitude more distributed than Binance Coin. This is due to its PoA model that gives the Binance exchange full control.
But why does this matter? Binance has lower fees than Ethereum and it’s faster, right? Who cares if it is centralized?
Every individual’s answer to these questions depends on their reason for investing in the first place. Do you wish to speculate on a cryptocurrency? Or are you interested in a decentralized ecosystem that solves real-world problems?
The problems that cryptocurrency, specifically Bitcoin, aims to solve are related to control and freedom, not just making money on speculation.
Who should control money and its supply? Should one company or government make the rules for the rest of us? Who decides who is allowed to get access to the financial system?
These are all serious questions that humanity has faced for nearly its whole existence. So far, the result of giving one single entity control over money has proven to be less than ideal. It causes currency debasement and inflation, disenfranchisement of certain communities who don’t meet the made-up prerequisites and far more.
If you are interested in speculation and trying to make money, perhaps Binance Coin could be an opportunity as more and more leave Ethereum to search for cheaper transactions. If you are interested in building systems without central control, then an investment in Binance Coin would be ironic to that cause.
With the level of control the Binance exchange has in the PoA model, assets issued on it seem far closer to securities than anything else. It is unlike many other chains where nodes, miners, validators and stake pools are ungoverned by the chain’s creators. With this structure, there could even be cause for regulatory concern.
To be fair, there is nothing wrong with making speculative investments. Cryptocurrency itself is widely considered speculative in general due to its reformative nature. That’s why it can help to understand why cryptocurrency exists in the first place — to give economic empowerment and self-sovereignty to individuals and to remove the control from the hands of the few and give it back to the people, and Binance Coin is the direct opposite.