According to Binance CEO Changpeng Zhao, the creation of a native blockchain was envisaged initially, back when the exchange opened. The network was launched in February 2019. Its main purpose is to create an alternative marketplace that allows the decentralised exchange of assets as well as the issuance of new tokens.
What makes Binance Chain special is that the network is designed to be very simple, but it is also designed to handle high loads. CZ notes that this is more important than functionality. Therefore, in the initial stages, the number of features was minimal, and the focus was on reliability in processing a large number of transactions (several thousand per second).
Developers from the beginning were able to mint tokens on Binance Chain, send, receive, burn them, and also offer trading pairs for Binance DEX. One of the most important components of the ecosystem, along with the chain itself, is the Binance Coin (BNB) cryptocurrency, which is used to pay transaction fees on the network.
Opportunities for the user:
Creating your own crypto address on the Binance Chain network.
Use of Binance Chain Wallet.
Integration with Trust Wallet mobile wallet.
Integration with hardware wallets (Ledger Nano S, etc.).
As the chain evolved, the developers increased the number of features as well as cross-chain interaction capabilities. At the start (during the testnet), the network consisted of 11 nodes, which were combined in different ways to optimize performance. Mainnet is capable of working with a limited number of nodes, but of a large size.
A user can start a node and become a validator on their own, but this requires quite powerful hardware – after all, blocks in the network are generated every second.
Examples of use
The main product powered by Binance Chain is the decentralised exchange Binance DEX. It represents the first implementation of Binance towards financial freedom for users. With DEX, a customer manages its own funds and does not have to trust anyone with its storage or provide any personal information. DEX works through nodes distributed across the globe, so it does not have “crashes” like centralized sites do.
Binance DEX operates like a classic cryptocurrency network like Bitcoin. Thus, most transactions are transparent and can be seen in a blockchain browser.
Other tools on Binance Chain:
Bridge. A bridge service that allows you to transfer assets from one network to another. For example, you can exchange USDT of TRX-20 standard to USDT of BEP-20 standard.
Stacking. Allows you to delegate BNB coins to validators and earn money. To create your own validator node, you need 10 BNB as of this writing. To delegate – only 0.003
Observer https://explorer.binance.org/. Displays information about tokens, transactions and other activity on the network.
Binance Smart Chain (BSC) Blockchain
Some time after the launch of Binance Chain’s minnet, it became clear that this network shows high throughput, low latency and a large capacity reserve. However, at the same time, the developers saw that the focus on uptime was detrimental to usability and functionality. Token issuers needed the ability to incorporate some decentralised functions, forms of management, etc. into their assets.
A parallel chain called the Binance Smart Chain, or BSC for short, was launched in 2020 to close customer needs. It aims to retain high performance but add more user-friendly smart contracting features.
Technical features of the architecture:
Blockchain is autonomous. It is not a Layer 2 solution. Therefore, even in case of Binance Chain malfunctions, BSC can continue to function successfully.
Compatibility with Ethereum. Most of the decentralised applications developed for Ethereum will run on BSC virtually unchanged.
Consensus and governance involving stacking. The Proof-of-Stake consensus mechanism is secure and highly environmentally friendly, and gives more flexibility for community management.
Strong mutual communication with Binance Chain. The communication protocol focuses on the movement of digital assets between BC and BSC.
The native token of this network is also BNB. Its key purposes: payment of transaction fees, smart contract deployment fees, betting on selected validators and receiving rewards, and performing crosschain transactions.
The tokens running on the BSC are of the BEP-20 standard. The user has the ability to exchange BEP-2 and BEP-8 Binance Chain tokens for BEP-20. One of the easiest ways to do this is to apply the Binance Chain Wallet extension.
Examples of blockchain use cases
Since the launch of BSC in September 2020, the platform has grown tremendously. Daily transaction volumes on the blockchain have even exceeded Ethereum at one point. This success can be attributed to low transaction fees, high transaction speeds, and the ability for developers to easily switch from Ethereum to Binance Smart Chain.
The number of applications running on this network is now measured in the hundreds. According to data from aggregator DappRadar as of October 2021, the top most popular decentralised apps look like this (with the amount of funds blocked in the protocol)
DEX PancakeSwap – $4,330,000,000
Game protocol MOBOX – $120,000,000
CryptoMines Game – $45,500,000
CryptoBay Game – $28,950,000
DEX ApeSwap – $405,000,000
The list includes decentralised trading and credit protocols, games, high-risk investment vehicles and more.
Binance Smart Chain Apps
Optimal choice of wallets for Binance Smart Chain (BSC):
MetaMask (although it’s better known as a wallet for Ethereum, it’s easy enough to switch to BSC, there’s a drop-down list at the top of the extension window where the network is selected).
Binance Chain Wallet.
That’s not really all there is to it. The chain is also supported by other third-party wallets – TokenPocket, Math Wallet, Ledger, Safepal, for example.
Top 10 projects on Binance Smart Chain by market capitalisation
According to CoinGecko’s rankings, the most capitalised tokens and projects on BSC are:
Binance Coin (BNB). The main cryptocurrency of the ecosystem, participating in almost all areas of activity on the Binance platform.
Binance USD (BUSD). A dollar-based stabelcoin maintained by Binance in partnership with Paxos. The Stablecoin is regulated under US law and is fully secured.
The Graph (GRT). An indexing protocol and APIs for finding information on blockchains such as Ethereum, as well as for quickly querying search results.
PancakeSwap (CAKE). Decentralised exchange with AMM, including liquidity pools, lotteries, NFT marketplace, prediction marketplace (in beta).
Radio Caca (RACA). Token of the official partner of the USM (United States of Mars) metaclass. Serves to participate in project management and game development.
Ontology (ONT). A project focused on digital identity with data privacy. Also supports a marketplace for trading sensitive data.
1inch (1INCH). Liquidity aggregator from different decentralized protocols. It allows to trade in the most profitable way by selecting the liquidity provider that is currently the best for each transaction.
Coin98 (C98). A versatile DeFi platform that includes web3 wallet, stacking and lending tools, cryoparks, token creation functionality and more.
Injective Protocol (INJ). A protocol for creating unlimited trading markets with instant transactions and zero fees.
Alpha Finance (ALPHA). A decentralised finance ecosystem that includes a range of features for passive income. Gradually expanding by adding new options.
The professionalism and foresight with which Binance developers are introducing new infrastructure solutions cannot be overlooked. Most of them are a huge success. The same can be said about Binance Chain and Binance Smart Chain – the first network was a kind of “test of a pen”, the second took into account all the shortcomings of the first and developed with unprecedented speed, quickly catching up with other popular smart contract platforms, including Ethereum. At the start, $100 million was allocated to develop the chain, and in October 2021, Binance announced it was allocating another $1 billion to help support developers, educate investors, and generally develop the crypto industry.