UPDATE: Following the COSS/LALA merger, the functionality of CFT (25% discount) is now included in the COS token itself.
Max Burn Amount
Coss fee token
1,000,000 / Month
50% (Year 1) down to 0% (Year 5)
20% of Profits / Quarter
Binance Coin (BNB) is a well established fee-reduction token, which has gained large support alongside Binance’s success. The COSS fee token (CFT) is similar in many aspects to BNB. It too, allows traders to use it to pay fees on the COSS.io exchange and receive a discount on fees. See here for an introduction to CFT.
Comparing BNB vs. CFT
Both coins have a similar max supply and both intend to burn down the max supply to 50% of the max. CFT was issued at a similar price to BNB ($0.10 vs $0.15), however, due to the unprecedented success of the Binance exchange BNB has seen heights of $24 and continues to climb.
Token Fee Reduction Rates
CFT gives a fixed 25% discount on trading fees forever. The token is consumed when used to pay for fees. 50% of the tokens used for fees go back to COSS, the other 50% is distributed to COSS token holders in the FSA.
BNB initially gave 50% of fees in its first year, but each subsequent year the discount halves. Year 2 gives 25% discount, year 3 gives 12.5% discount, year 4 gives 6.25% discount. After 5 years, BNB will no longer offer a discount. BNB is consumed when using it to pay for fees. The token goes back to Binance.
Other Functions of the Tokens
CFT holders can participate in airdrops. Previous airdrops have included Substratum and Bitwatt. A set amount of tokens was divided amongst all CFT holders who held a minimum amount in their accounts. More features are planned for CFT, but have yet to be announced. A community voting feature is potentially coming.
BNB holders are also entitled to airdrops. Previous airdrops have included coins such as Enjin. Airdrops are distributed to the top BNB holders. Community voting has been possible for BNB holders, although no new votes have taken place since October 2018. Given the value of BNB, many places also accept it as a payment method.
In the future, Binance plans to release a DEX. The BNB token will be used to facilitate payments on the DEX once the coin moves to the Binance mainnet.
Token Burn Rates
CFT is being burned at a fixed rate of 1,000,000 CFT a month until max supply reaches 120,000,000. In 10 years time, the maximum amount of CFT will have been burned.
BNB has a different burn mechanic. Each quarter, it uses 20% of the exchange’s profits to buy back BNB and then burns these tokens. This results in a varied burn amount every three months.
Previous Binance Coin Burn Amounts:
|Q1 (2017)||986,000 BNB||$1,500,000|
|Q2 (2017)||1,821,586 BNB||$40,000,000|
|Q3 (2018)||2,220,314 BNB||$30,000,000|
|Q4 (2018)||2,528,767 BNB||$32,000,000|
|Q5 (2018)||1,643,986 BNB||$17,000,000|
|Q6 (2018)||1,623,818 BNB||$9,400,000|
|Q7 (2019)||829,888 BNB||$15,600,000|
Current Token Prices
Why Compare BNB vs. CFT?
Both coins have a utility purpose and in some respect their price doesn’t matter as the discount on fees they provide is relative (fixed percentage).
Traders new to COSS might be interested to learn that CFT can provide many of the same benefits as BNB, but on the COSS exchange. With COSS having the benefit of the fee split allocation (50% share of fees paid back to COSS token holders), there is an additional incentive to trade on COSS.
The CFT token is in its infancy, having begun trading at the very end of 2018. Looking at the performance of BNB is interesting as it maps out the potential future for CFT and the COSS exchange. Look at how the quarterly coin burns have helped raise BNB prices, even throughout bear markets. Although BNB benefits from additional speculation on Binance’s future, it is good to know that this token model works.
Your Thoughts on CFT
CFT is additional to the COSS token. Some members of the COSS community felt the fee reduction benefits of CFT could have been incorporated into the COSS token itself, but others disagree. The argument against this is that COSS is a passive income token and spending it on fees would not be desirable for those wanting to hold onto the token to continue receiving their FSA.
What are your thoughts on the implementation of CFT? Given how BNB has performed, do you think the CFT token can expect a similar future? Is it even fair to compare the two tokens?