Ethereum dapps get cozy on Binance Smart Chain

Alex Alex 12 May
Ethereum dapps get cozy on Binance Smart Chain

Binance started as a popular  centralized crypto exchange,   which in 2020 saw a record total trading  volume of over 3 trillion dollars. Since then, Binance has expanded to  become an entire crypto ecosystem. Users now have access to lending products, the  BUSD stable coin, a decentralized exchange,   and a community launchpool which helps new  projects to build on the Binance blockchain.

As of September 2020, the platform began  hosting smart contract functionality   on the Binance Smart Chain, which runs  parallel to the main Binance blockchain. This ensures that the Smart Chain can grow without  slowing down the other tools that are built   on the ecosystem. Ethereum dapps get cozy on Binance Smart ChainAnd the BNB development  fund is aggressively pursuing this cause! Also, 100 million dollars has been set aside  for projects that commit to building on BSC,   with individual projects  able to claim up to $100,000   if they are successfully chosen  by the Binance community.

BSC developers claim that the blockchain’s  Proof of Staked Authority (PoSA) consensus   provides the ideal balance between  high performance and decentralization,   despite the fact that there are only 21  validators compared to Ethereum’s 11,000 nodes.

Binance founder Changpeng Zhao (‘CZ’) has been  quite vocal on Twitter about his intention to   sort out the high Ethereum gas fees by offering  a cheaper and more scalable solution on Binance.

Unlike the Binance blockchain, where many of  the projects have been built from the ground up,   Binance Smart Chain is being populated mostly  by Ethereum-based projects that are bridging   between the two blockchains in order to  provide relief for the high gas fees. That doesn’t mean that they are  completely moving away from Ethereum,   just that they have decided to build out,  and leverage the benefits of both platforms.

A lot of experienced crypto traders will  have heard of IDEX, which is one of the   oldest decentralized exchanges in the space. IDEX has traditionally been a place where traders  could buy newly-listed Ethereum projects via   the metamask wallet, but the popularity of the  exchange has been tested in the past year or so,   perhaps because of the popularity  of Uniswap and liquidity farming.

Now, IDEX is taking the initiative  to launch a multi-chain solution,   which allows them to onboard new assets  and reduce settlement costs for their users. The integration with Binance Smart Chain  has been completed, and the initial trades   have been finalised with an average transaction  fee of 10 cents, compared to $4.50 on Ethereum.

IDEX is also planning to benefit  from the future of cross-chain DeFi,   by integrating with both Polkadot and Algorand.

Sushiswap is another popular DeFi  project that has made the move onto BSC,   in order to escape from Ethereum gas fees. They have also built out onto the Fantom  blockchain, and this cross-chain expansion   arguably leaves them in a stronger position  than c, the project that, ironically,   Sushiswap copied all of their original code from!

The third Ethereum-based DeFi protocol  that has migrated onto BSC is Cream Finance! In a Medium post, the team behind the Cream  lending and liquidity farming protocol   talked about the advantages of having access  to the Binance ecosystem’s 170 fiat gateways   and 400,000 user accounts. They see centralized exchanges as having a   vital role in the growth of the DeFi space  and the accessibility of governance protocols. How better to make your platform  democratic than having hundreds   and thousands of users who can vote and  contribute to the decision-making process?

The DeFi protocols that are firmly based on  Binance Smart Chain include Pancake Swap,   which is basically a copy of Sushiswap  except with the addition of syrup,   and Zero Swap, a familiarly-structured  lending and borrowing platform   that supports both ERC-20 and BEP2 tokens.

Aside from DeFi, another area  of the crypto sphere which is   growing rapidly are non-fungible tokens, or NFTs. Bounce Finance is a decentralized auction  platform that allows users to bid for NFTs   (pieces of digital art) using  either BNB or ETH for payment.

By going live on both blockchains, the Bounce  team were one of the first to take advantage   of MetaMask's Binance Smart Chain integration.  Yep - by simply adding the Binance Network  onto your Metamask in the settings,   you can now use the browser extension to interact  with Binance Smart Chain apps. Pretty cool!

Considering that the blockchain market size is   predicted to grow exponentially  over the next years and decades,   there is surely enough space for a symbiotic  relationship between Binance and Ethereum.

Ethereum’s current scaling issues can be  boosted by the capabilities of the more   centralized Binance blockchain, and this  will allow some of the crypto industry’s   most popular DApps to continue to function  without the barrier of extremely high fees. Meanwhile, projects built on Binance can  effectively improve their level of security   and decentralization by also  operating on the Ethereum blockchain. And with other interoperable blockchains  like Polkadot and Cosmos on the horizon,   the future looks to be multi-chain regardless.

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