Binance Smart Chain (BSC) was launched in the middle of the 2020 bull run. The goal of BSC was to be an alternative to Ethereum, which at that time was having serious scalability issues.
Initially, the team designed the Binance Chain, which is a separate chain from the Binance Smart Chain. As the Binance Chain did not receive the adoption that the team hoped for they expanded their platform and created the Binance Smart Chain (BSC).
BSC: an improved Ethereum
The BSC is a smart contract programmable network. Creating such a platform, however, takes extensive research and testing. So, Binance simply forked Ethereum’s programming language, solidity. However, the Binance team didn’t stop at this point. They recognized that there were many issues that could be improved upon Ethereum. So, they implemented a proof of stake consensus algorithm.
Proof of Stake
This made the Binance Smart Chain the first proof of stake smart contract ecosystem. Transactions on the Binance Smart Contract are validated by a set of 21 nodes. BNB holders can stake their BNB for validator blocks to operate. Proof of stake operates is more efficient than proof of work. Thus, transactions on the Binance Smart Chain are much faster and cheaper.
Binance Smart Chain came out in the heat of a bullrun when Ethereum gas fees were becoming a big issue as the network’s use was surging.
Instead of changing the Binance centralized structure of the Binance Chain, the goal of Binance was to create a best of both worlds. So, CZ, the CEO of Binance created the word CEDEFI (Centralized DeFi). Binance created a bridge to the BEP2 token with the BEP20 token. The BEP20 token is the token used for the Binance Smart Chain.
Binance’s programmers took the base code for Ethereum and built their network around that. This means that it easy for developers to deploy their applications on the Binance Smart Chain. BSC is compatible with the most regularly used dApps such as MetaMask. This allows BSC users to access other dApps such as Pancakeswap. To learn how to connect BSC with MetaMask you can read following article: How to configure BSC for MetaMask.
Similar to etherscan.io, there is bscscan.com. Users may track transactions using this application. BSC is notorious for impostures. It’s good to examine the contract address of the token one wishes to purchase and ensure they don’t see anything that looks fishy.
Binance makes it extraordinarily easy access the Binance Smart Chain. One simply needs to configure their MetaMask wallet for the Binance Smart Chain.
Binance NFT Marketplace
Since June 2021, the Binance Smart Chain has added an NFT marketplace. Thus, Binance aims to take marketshare in the NFT space. This strategic decision could pay off, as the NFT market is growing rapidly and many users are currently looking for alternatives to the Ethereum NFT market, as the high gas fees on the Ethereum network are hurting NFT trading. Binance can undercut these gas fees by quite a bit.
Some are critical of Binance’s term CEDEFI, and that it opposes decentralization which is contrary to what blockchain is about. None the less, Binance succeeded in creating a similar user experience to Ethereum while reducing network fees and wait times between transactions. What isn’t clear is if Binance will continue to have network volume after Ethereum 2.0 and layer 2 solutions will solve the gas fee crisis. However, there will likely be a further development in the Binance Smart Chain as well as Ethereum.
Aaron is passionate about blockchain and has been an investor in cryptocurrencies for the past years. He enjoys engaging with other people in the cryptocurrency community online, particularly on Telegram, and learning from experts.