BSC Blockchain - Binance Smart Chain - was introduced in the year 2020 by Binance. The plan behind this platform is to help investors and traders to manage their digital assets with high capacity. Coupled with an easier way of running applications and executing contracts.
With Binance Smart Chain, you can also create De-Fi products, NFT apps, and dApps. The Ethereum virtual machine is supported on the BSC and users are allowed to create tokens that fit any transaction which needs to be carried out. Binance made this new platform compatible with Ethereum, one of the most popular cryptos today.
The platform makes use of the Proof-of-Staked-Authority (PoSA) consensus mechanism rather than Proof-of-Work (PoW) which helps to reduce the time for transactions and approves lesser transaction fees. The statistics of the Binance Smart Chain have shown that more than twelve million transactions occur in a day. However, when it comes to experience and community usage, Binance's large user base supports new projects making BSC successful.
Binance Smart Chain Analytics
To have a good understanding of what the BSC entails, it is required to compare the BSC blockchain to every other blockchain in the market. This includes the properties, features, designs, etc. Just like any other blockchain in the market, it has both its advantages and disadvantages.
Advantages of BSC blockchain
- Speedy Transactions
BSC has been recognized to be a fast and reliable contract platform. In less than 10 seconds, a transaction is performed on the BSC blockchain. The fast transaction of Bitcoins and assets has made staking easier and the pegging of tokens quicker.
- Less Transaction fee
One of the advantages of Binance Smart Chain which draws a lot of attention is the low fee required. A similar transaction on the Ethereum blockchain would cost more than when it is done on the Binance Smart Chain network. Binance also gives room for a couple of transitions to fit into one block.
Disadvantages of Binance Smart Chain
It is a centralized chain network, thereby making it vulnerable to hacking. There can be cases of system failures in some scenarios.
Just like the Binance Chain, Binance Smart Chain is centralized. The Proof-of-Staked-Authority mining uses 21 validators which are rotated every 24 hours to keep the chain running.
Binance Smart Chain Wallet
The Binance Chain Wallet is used to maintain the Binance exchange. They allow users to store their assets safely from the exchange medium. This is the official wallet by the Binance Smart Chain which is available to be used on both Android, and iOS, and system browsers such as Google Chrome and Firefox. There are other major wallets including;
Metamask is popularly called the Binance Smart Chain MetaMask, it is a popular crypto wallet owned and controlled by the Ethereum company. This blockchain allows buying, staking, and selling of tokens which can be reviewed on the Binance Smart Chain and Ethereum.
- Trust Wallet
This is the first-ever wallet to be supported by the Binance Smart Chain. It supports other available networks such as Solana, Ethereum, Tron, etc. With the trust wallet, there is room for buying and selling a large number of digital assets, swapping and staking tokens for a reward.
- Binance Bridge
Binance Bridge is a chain wallet that deals majorly with the minting of tokens to be used on non-compatible blockchains. Anyone is allowed to create a new token by pegging with the original token to suit a particular transaction. Only a network fee will have to be paid to the blockchain as transaction fees. Others that can be used are; Ledger, Arkane, BitKeep, Safepal, etc.
Binance Smart Chain Airdrops
The technique of releasing cryptocurrency tokens to numerous wallet addresses is known as "airdrop". These wallet addresses' owners might get those tokens for nothing or in exchange for completing super easy tasks. Airdrops are used to raise more awareness about different assets or coins. However, several platforms have been created by Binance Smart Chain to promote getting rewards.
It provides instant notifications and giveaways on NFT projects, games, gambling, and crypto markets. To enable a user to make use of a BSC airdrop, it requires a particular amount of the asset in your wallet to be eligible to hold a certain token. Crypto airdrops are both beneficial for senders and receivers. For the receivers, it is a passive income. Airdrop platform sends information about crypto news, and tokens that are having profit income thus helping a project’s user community.
How does the BSC chain work from a technical point of view?
- Consensus Mechanism
With a Proof-of-Staked consensus method, Binance Smart Chain achieves block times of under three seconds. For example, participants stake Binance coins (BNB) to become validators in a process known as Proof-of-Staked-Authority. They will be compensated with transaction fees from the transactions contained in the block if it is proposed.
Because the Binance coin is not inflationary, it should be noted that, in contrast to many protocols, there is no block subsidy of the newly created BNB. On the other hand, because the Binance staff frequently burns coins, the supply of BNB gradually diminishes over time.
- Staking Binance Coin
Binance coin owners stake by adding their bonded tokens to a staking pool. They can then allocate their tokens to a prospect or validator of their choice. As soon as the election for the subsequent validator set starts, they can send their tokens to another validator once more. The blocking incentive can be distributed to delegators by elected validators.
BSC installs its staking mechanism on Binance to support this feature, keeping it in line with Ethereum. This indicates that, rather than the Binance Smart Chain network, the Binance network is used for token bonding or delegation.
- Compatibility with Ethereum
Ethereum, the most widely used smart contract platform, handled the grunt work for Binance. It had a sizable user base, mining community, and development scene. The network has outperformed its rivals despite issues including rising gas prices and security flaws. Instead of starting from scratch, Binance chose to adapt what worked for Ethereum with a few changes, most notably the consensus algorithm. Cross-chain interoperability is made easier by copying the Ethereum source code, allowing native Ethereum dApps to be quickly moved to BSC.
- NFT Support
The network can now access the NFT market thanks to the Binance Smart Chain. One of the blockchain industry's most rapidly expanding sub-sectors is NFTs. These tokens add an additional level of rarity to digital assets. Notably, NFTs are currently being sold for millions of dollars.
- Cross Coin Compatibility
With the concept that users might easily transfer assets from one blockchain to another, Binance Smart Chain was designed as an independent but complementary system to the current Binance Chain. In this way, BSC allows for robust decentralized app development while Binance Chain allows for quick trades.
While Binance Chain supports the BEP-2 token standard, Binance Smart Chain supports the BEP-20 token standard, which is identical to its ERC-20 counterpart on Ethereum. The fungible digital currencies or tokens can be deployed by anyone on the Binance Smart Chain thanks to the developer-friendly BEP20 token standard. Additionally, prominent digital assets from other chains that are pegged to BEP20 tokens can be moved to the Binance Smart Chain. You may, for instance, use Binance.
Binance Smart Chain was adopted after the Binance chain to improve the options available for traders. By offering the necessary funds for development, advising resources, and a launchpad for any required listing and fundraising activities, it supports cryptocurrency project teams. Binance puts all these together to keep its platform ahead of other cryptocurrencies. Although Binance Smart Chain is self-custodial, only a portion of the blockchain is decentralized. It has centralized components that enable the BSC blockchain to operate at great capacity and speed.