đź“šHow to Crypto Investor | Binance Smart Chain
We continue with our Crypto Investor Guide, and today look at the relatively small but famous and promoted network - Binance Smart Chain. Many developers and crypto-holders use it as a cheaper analog of ETH with a helpful connection to the Binance ecosystem, including powerful CEX and DEX.
What is BSC?
Binance is one of the first companies that see the potential and importance of corporate blockchain in the blockchain assets market (surprise🤷‍♂️). So in 2019, Binance launched its first Binance Chain network with a native BNB token. a
Binance Smart Chain (second Binance's network) was launched in 2020 when all market players saw growing DeFi potential and new smart-contract use cases.
In contrast to Binance Chain, BSC was created as an EVM compatibility blockchain that supports Ethereum smart contracts, so developers could transfer their dApp from Ethereum to BSC just via "copy-paste."
In addition to EVM support, BSC bandwidth is almost 5x of Ethereum bandwidth, so the transaction fees are much lower. These advantages stimulate the BSC's fast growth in 2021 when the DeFi boom has caused transaction fees in the Ethereum network to reach tens of dollars.
For now, BSC has a developed ecosystem and analogs of many popular Ethereum DeFi-services, including DEXs, borrow protocols, NFT-marketplaces, staking, etc.
If we look at TVL or overall scale, BSC is much smaller than Ethereum, but Binance's ecosystem support and low fees make BSC a useful blockchain for many traders and degenes, so you absolutely need to know how to use it.
Best BSC Wallets
Binance Chain Extension Wallet: Official Binance wallet. It's non-custodial but only available as a browser extension.
Metamask: Compatible with BSC. We wrote more about that wallet and how to connect it to other networks in our How to Crypto investor Basic lessons.
TrustWallet: Official partner of Binance and - one of the best non-custodial wallets for BSC. But actually, it's the multichain wallet.
Useful Binance ecosystem DEXs
Pancakeswap: The largest DEX on the BSC, but the site supports a few blockchains, so you can make cross-chain swaps. NFTs are also there.
ApeSwap: Not so many liquid pairs as on Pancakeswap, but for most BSC users, quite enough.
Bakeryswap: Is a smaller DEX, but it is useful and supports NFTs, so it is still worth exploring.
Top NFT marketplaces
In addition to the above DEX with NFT support, you can also use NFT-marketplaces like:
AirNFT: Local analog of OpneSea. You can buy, sell and create your NFTs. There is a convenient website, NFT staking, and a built-in launchpad.
Treasureland: The NFT aggregator that supports BSC and a few other blockchains.
Venly: Earlier known as Arkane. Quality marketplace with NFTs on BSC, MATIC, and AVAC networks.
âť—The BSC network uses BEP-20 and BEP-721 token standards similar to Ethereum ERC-20 and ERC-721. Only BSC-compatible wallets are suitable for such tokens. You also need to transform a native BNB BEP-20 token to BEP 2 or BEP 8 standards if you want to interact with the first Binance Chain.
Also, there is Binance Bridge, Ren, and a few other bridges to convert BEP-20 tokens to another standard or other network's tokens in BEP-20.
Explore the BSC ecosystem by yourself with the dApp and services infographic:
🔸 The Blockchain explorer.
🔸 List of BEP-20 tokens.
Why can't BSC overtake Ethereum and other blockchains?
It's a good question if we mention that BSC has low fees and compatibility with EVM. Several factors disturb BSC еo become the ultimate market blockchain:
Relatively low bandwidth. 70 TPS - is more than Ethereum but much less than, for example, Solana or Terra.
Binance dependent. BSC is considered a blockchain released by Binance to serve the interests of only Binance and partners. In fact, there is run many non-Binance projects, but stereotypes change more slowly than the ecosystem.
Centralization. Only 21 validators are needed to process BSC transactions. It's much less than miners in the Ethereum network. It's ok for PoS networks, but there is unofficial information that Binance directly or indirectly rules most of its validators.
But the fact is that the BSC ecosystem grows, expands, and develops. According to DeFi Lama, BSC has third steps by TVL and second by a protocols number (more only on the Ethereum network).