Ethereum transaction fees are too high for many retail investors to use. Just to make a simple transaction, investors may need to pay up to $50, depending on the demand for network space on Ethereum’s blockchain at any given moment.
Binance has made a smart contract enabled blockchain called Binance Smart Chain (BSC) which is meant to compete with Ethereum. The leading decentralized exchange on BSC is called Pancakeswap, and investors can use the platform to trade crypto directly from their cryptocurrency wallet, all while avoiding high network fees. But, these fees come with a price – security. To learn more about Bonfire and the landscape of the Binance Smart Chain ecosystem, keep reading.
What is Bonfire?
Bonfire is a BEP-20 token that uses the Binance Smart Chain as its core blockchain. The project has the long term goal of creating a decentralized social media platform for artists to sell non fungible tokens (NFTs), as well as providing many other yet to be announced features.
As of writing, Bonfire has yet to establish its minimal viable product, and investors are buying up Bonfire purely off speculation. The token follows similar tokenomics (token economics) as SafeMoon and NFTART.finance.
Bonfire incentivizes investors to hold their Bonfire tokens through charging s 10% transaction fee. 5% of this fee is distributed amongst Bonfire token holders, while the other 5% is added to the Pancakeswap liquidity pool. While this may sound enticing, these token economics greatly resemble the economics behind pyramid schemes.
Since the transaction fees are so low on the Binance Smart Chain (when compared to Ethereum), the amount of spam is greatly increased. Remember a time when calls and texts still costed money to send across the phone network. Communication styles were completely different, and phishing spam calls were much more rare. In the same way, people use the cheap (and centralized) Binance Smart Chain to spam loads of pump and dump coins on the market. If you're new to crypto – you might want to stick to Bitcoin.
Brief History of Bonfire
Bonfire token has a brief history, being that the token launched just 3 days ago on Binance Smart Chain. The initial maximum supply was 1,000,000,000,000,000 (1 quadrillion), but 30% of these tokens have been burned. Still, 700,000,000,000,000 is an enormous amount of tokens when compared to Bitcoin’s maximum supply of 21 million and Ethereum’s circulating supply of 115 million.
Bonfire began trading on Pancakeswap for around $0.00000023. Since then, the token has appreciated to $0.0000007 in just 3 days. In percentage terms, Bonfire has appreciated over 300%, averaging over 100% returns per day since its launch.
Step 1: Open a Binance Account.
Centralized exchanges like Coinbase, eToro and Kraken have yet to support any Binance Smart Chain tokens. Most of these cryptocurrencies are extremely new, and most teams behind these tokens haven’t developed a minimum viable product yet.
In order to use Pancakeswap, you’ll need to own BNB tokens. These tokens are available on Binance, so you’ll need to make an account with the cryptocurrency exchange to get started. If you use Binance.us, it may take some time to get approved for trading. Another option is to use Binance.com, but if you have an IP address that shows you’re from the U.S, Binance won’t allow you to make an account.
Step 2: Download MetaMask.
Once you’ve gotten your hands on some BNB tokens, you’ll need to send them to a cryptocurrency wallet that can connect to Pancakeswap. The best options on the market are MetaMask and Trust Wallet, as they have a secure platform that allows you to trade any tokens on Pancakeswap.
Best Software Wallet: MetaMask
When you download MetaMask, the wallet will be set to Ethereum’s network by default. You’ll see this appear on the top of your wallet, where it says “Ethereum Mainnet”. To connect to Binance Smart Chain, you’ll need to click “Ethereum Mainnet” and choose “Custom RPC”. MetaMask will then ask you for information to connect to a new network, and you’ll need to enter the following information for Binance Smart Chain.
- Network name: Binance Smart Chain
- New RPC URL: https://bsc-dataseed1.binance.org:443
- ChainID: 56
- Symbol: BNB
- Block Explorer: https://explorer.binance.org/smart
Once you’ve connected your wallet to Binance Smart Chain, you’re ready to send your BNB tokens to your MetaMask wallet. Simply send your BNB to your wallet’s BNB address. Once your tokens are in your MetaMask, you can use Pancakeswap’s “bridge” feature to convert your tokens to work on the Binance Smart Chain.
Step 3: Buy a Hardware Wallet (optional).
Best Hardware Wallet for Bonfire: SafePal S1
The SafePal S1 is a hardware wallet that can support over 10,000 different cryptocurrencies, including Binance Smart Chain tokens! The SafePal S1 will likely be the only hardware wallet you’ll ever need. Also, it’s 1 of the most affordable wallet options on the market, coming in at just $40 on SafePal’s website. Start with the link below.
- Crypto enthusiasts
Step 3: Make your purchase.
Congratulations, you’ve gotten through all the complicated steps to be an early investor in Bonfire. Using Pancakeswap is much easier than setting up your crypto wallet – all you need to do is connect your MetaMask wallet to Pancakeswap.finance when prompted upon visiting the website.
You can then select Bonfire and purchase it with your BNB tokens. Soon after approving the transaction through your Metamask wallet, your Bonfire tokens will be sent to your crypto wallet on MetaMask.
Bonus Section:
Investing early in Binance Smart Chain products is extremely risky, but it may just pay off. Many tokens have appreciated 100% or more in value in just a few days, making investors much higher returns than typically found in the stock market.
Leverage Your Crypto & Avoid Capital Gains
If you’re interested in taking profits from your cryptocurrency, look no further than BlockFi. BlockFi lets you collateralize your cryptocurrency for loans. You can spend these loans however you like, and you’re not required to pay capital gains tax so long as you pay your loans back. If you default on your loan, then your cryptocurrency collateral will be taken to pay off your outstanding payments.
If you’re in crypto for the long run, then you may want to use BlockFi to earn interest on your cryptocurrency. BlockFi has savings accounts which yield over 5% annual interest rate, paid in crypto. Depending on the crypto asset you provide, your interest rate will differ.
Current Crypto Prices
Cryptocurrencies have skyrocketed in 2021 with institutional interest from companies like Tesla, Paypal and Microstrategies. While Bitcoin and Ethereum have both appreciated over 100% in the past few months, smaller market cap cryptos have seen even higher gains. Tokens on Binance Smart Chain are some of the most volatile cryptocurrencies to invest in, but the potential payoff just may be worth it.
Is Bonfire a Good Investment?
Being that Bonfire is such a new cryptocurrency, there may be room for the token to appreciate. However, based on the fundamentals Bonfire is a purely speculative investment. The company has yet to release a usable product, and there’s no guarantee that the team will deliver on their promises.