The addition of Binance Coin (BNB) during the CoinShares Altcoins ETF’s (DIME) quarterly rebalance raised questions about how an exchange token fits an infrastructure investment strategy. The answer lies in mechanisms that make BNB scarcer over time and growing institutional adoption.
DIME focuses on Layer 1 networks that support decentralized applications and transaction processing rather than speculative tokens, according to CoinShares. The equal-weighted portfolio excludes bitcoin and Ethereum to concentrate on application-layer infrastructure.
BNB qualifies because it powers the second-largest blockchain by decentralized exchange volume after Ethereum, according to data from DeFiLlama cited in recent CoinShares’ insights. But network size alone doesn’t explain the selection. The Binance Coin economic model creates scarcity tied directly to usage — a characteristic that distinguishes infrastructure from speculation.
The token uses two systems that permanently remove supply from circulation. “Auto-Burn” removes roughly two million tokens each quarter based on the token’s price and how active the blockchain is. “Real-Time Burn” destroys part of the fees users pay whenever they make a transaction, according to CoinShares.
As of November 2025, more than 64 million tokens have been burned from the original 200 million supply, with a long-term target of 100 million tokens, according to CoinShares. The more people use BNB Chain, the more tokens get removed, creating tighter supply as demand grows.
Institutional capital has validated this model. BlackRock extended its $2.5 billion tokenized Treasury fund BUIDL to BNB Chain in late 2025, according to CoinShares. Kazakhstan’s national crypto fund, Alem Crypto Fund, made BNB its first official purchase.
BNB reached an all-time high near $1,370 in October 2025, according to CoinShares. The token launched at $0.15 during its 2017 initial coin offering. It now ranks as the fourth-largest cryptocurrency by market capitalization.
How BNB Burns Work
The “Auto-Burn” uses a formula that looks at two things: BNB’s average market price and how many transaction blocks the network processes each quarter. More blocks means more network activity, which triggers larger burns.
Meanwhile, “Real-Time Burn” works continuously. Every time someone uses BNB Chain by sending tokens, trading on decentralized exchanges, or using apps, a small portion of their transaction fee gets destroyed forever rather than going to validators.
BNB launched during the 2017 bull run as a utility token for the Binance exchange, where it offered discounted trading fees. After the mainnet launch in April 2019, BNB migrated from Ethereum to its own blockchain, according to CoinShares.
The broader ecosystem now includes opBNB, which reduces transaction costs for gaming and social apps, and BNB Greenfield, which provides decentralized storage for data-heavy platforms, according to CoinShares.
The transformation from exchange token to multi-function infrastructure explains DIME’s inclusion. The fund targets networks that capture value through usage rather than speculation, and BNB’s burn mechanics directly link scarcity to network activity.
For more news, information, and strategy, visit the CoinShares Crypto ETF Hub.
