What Is Binance Chain And BEP2?
As one of the largest virtual currency exchanges by its volume, Binance has successfully seen more than twenty-seven billion dollars through its open doors as it made headlines.
The headlines have to do with its launch of a mainnet: Binance Chain. Also, the platform executed a huge swap of its token; BNB that is off the Blockchain of Ethereum and it simultaneously launched a decentralized exchange.
Introducing Binance Chain
This is a Blockchain platform that was created by the prominent Binance crypto exchange.
Differing from so many relatively new blockchains, the Binance Chain is not a decentralized application platform actually. Also, it does not back smart contracts.
However, it is strictly aiming at being a very effective platform for the issuance of tokens and their trade. Nonetheless, its functionality may likely be modified in the near future in a bid to support not just smart contracts but other features too.
Furthermore, its traditional asset is BNB. Meanwhile, in the broad sense of the word, it actually performs the same operations as ETH does on the Ethereum platform.
What this means is that it is used in paying fees for the performance of diverse actions on the system. Note that, the token standard being used by Binance Chain is known as BEP2.
With the introduction to their latest technology, Binance describes Binance Chain to be a public blockchain whose focus is to send and trade Blockchain assets and also provide new possibilities for the future flow of assets on the Blockchain.
The focus of the Binance Chain is on:
- Performance, and;
- Ease of use
What Is BEP2?
The major thing to know is that BEP2 is a token that is pegged to Bitcoin. Also, Binance will be issuing some Cryptocurrency pegged tokens on the Binance Chain and it will begin with BTCB.
All of the pegged tokens are a hundred percent supported by the reverse native coin which in this case is Bitcoin. Addresses on the reserve are also published for everyone to audit.
Furthermore, its Blockchain provides a much simpler way to successfully audit a Cryptocurrency reserve than the usual bank balance tether. Also, trading pair will be developed on Binance site with a price of about 0.1%.
Ultimately, this will offer a simple way for anybody to easily convert from the pegged token back again to the native Binance coin. And, if the buy order is completely filled, another new order will be put in position while an equivalent amount of money will get deposited from the reserved address and into Binance.com.
To Wrap It Up
The major benefit of providing cryptocurrency pegged tokens is that it makes available to the Binance DEX traders the surplus coins that practically have their very own blockchains and are not native on the Binance Chain.
Due to the increase in the token section that is available in Binance DEX, there will be a rise in both liquidity and trading volume. It will increase the utility value further of Binance DEX.