Binance Chain and Binance Smart Chain are both based on blockchain technology. Blockchain is a distributed, unchangeable ledger that makes it easier to record transactions and monitor assets in a business network. An asset may be either physical (such as a home, vehicle, money, or land) or intangible (intellectual property, patents, copyrights, brand image).
On a blockchain network, almost anything of value may be recorded and sold, lowering risk and cost for all parties involved.
With the rising popularity of blockchain technology, it may be tough to keep up with the industry’s continual new innovations and releases. Binance is a significant participant in the cryptocurrency trading industry, having established two independent blockchains in recent years: Binance Chain and Binance Smart Chain. But what are the distinctions between these two blockchains, and what can you do with them?
What is Binance exchange?
Binance Trading is a large cryptocurrency exchange platform based in Hong Kong that was created in 2017. Its primary concentration is on cryptocurrency trading. Binance provides crypto-to-crypto trading in over 500 cryptocurrencies and virtual tokens, including Bitcoin (BTC), Ether (ETH), Litecoin (LTC), Dogecoin (DOGE), and its own Binance Coin (BNB).
In reaction to China’s stringent rules on crypto exchange operations, it relocated its headquarters to Malta, EU, in 2018.
The term ” Binance ” is derived from the words ” bitcoin ” and ” finance “. It promises to have strong safety and security requirements, a multi-tier and multi-cluster design, and great processing speed — it claims to be capable of processing about 1.4 million instructions per second.
It accepts over 500 currencies for trade, including bitcoin, ethereum, litecoin, and its own native BNB tokens.
Users must complete the relevant KYC standards before they may begin trading. After successfully creating a trading account, customers may begin trading by depositing cryptocurrency money into their Binance-provided public wallet address.
Limit, market, and stop-limit orders are all supported by the Binance exchange. Limit orders are only executed at the trader’s specified limit price. They are carried out as soon as possible at the greatest attainable market pricing. Stop limit orders become valid only when the price hits a certain threshold.
What is Binance Chain?
Binance Chain is the company’s first blockchain, which was released in April 2019. Its debut comes just two years after the company’s inception. This blockchain serves as a trading platform for crypto assets.
Binance Decentralized Exchange is one of the primary exchanges offered on the site, where you may trade Binance Coin (or BNB).
Binance Coin has become a significant rival to other major currencies, such as Bitcoin and Ethereum, as a result of the transition to a trading platform with its own cryptocurrency. In fact, as BNB has ascended up the ranks, Ethereum’s trade volume has taken a considerable impact.
Binance Chain is also intended to enable users to create decentralised applications, or Dapps. Because it does not rely on other parties to process transactions, the blockchain has cheap transaction costs.
Users do not have to worry about an authority entity having a grip on the cash at any particular moment since the system is decentralised and transparent.
So, how can you use Binance Chain? First and foremost, you may securely keep your bitcoin money. On this platform, you may also send, receive, and exchange Binance Coin.
You may also build trade pairings between different tokens. These are essentially crypto assets that may be exchanged for one another through an exchange.
Binance, on the other hand, created a new blockchain in September 2020 called Binance Smart Chain, or BSC.
What is Binance Smart Chain?
Binance Smart Chain is a separate blockchain, although it does not replace Binance Chain, despite being newer. Binance Smart Chain is intended to complement the original Binance Chain.
Because the Binance Chain has irritating programmability limits, this blockchain was created. As a result, the new blockchain has programmability that is compatible with the Ethereum Virtual Machine (EVM).
Because of BSC compatibility, Ethereum-based apps may operate on the blockchain. On the Binance Smart Chain, there are presently hundreds of Ethereum-hosted apps. However, Binance continues to host all of the top Dapps on BSC.
Binance Smart Chain employs staked authority proof (PoSA). A Proof of Bet Algorithm (PoSA) is a modified version of the original Proof of Stake method in which network participants stake their identity and reputation (instead of tokens). It is also a hybrid of Proof of Authority (PoA) and Delegated Proof of Stake (DPoS) (DPoS). A user may become a validator if they submit a valid block (or transactional data file).
Finally, smart contracts may be enabled by the BSC. These are contracts between two people that take the shape of code. This generates a blockchain-based application that can automate the creation of a contractual agreement without the need for human participation. These contracts have the potential to lower negotiating or transaction costs while also making the whole agreement process more easy for users.
In brief, Binance Smart Chain provides customers with a quick, secure, and EVM-enabled experience, as well as the convenience of a smart contract.
Binance Smart Chain Features
Binance Smart Chain is an independent blockchain that operates alongside Binance Chain. This implies that even if BC goes out of business, BSC will continue to oversee its technical and commercial duties.
BSC supports smart contracts that are Ethereum-compatible. With this functionality, developers may easily construct or move DApps, utilities, and other ecosystem components to the BSC network.
Supports staking and community governance
The platform uses a Proof of Stake (PoS) consensus methodology, more precisely, Proof of Authority. Binance Coin (BNB), BSC’s native coin, may be staked to aid with network security and vote on community governance protocols.
Its PoS methodology also enables it to process transactions more quickly, placing it ahead of networks that still use complete proof-of-work (PoW) systems.
Although BSC is not an alternate option, BC and BSC may freely interact with each other. Users may effortlessly transfer their cryptocurrency between BC and BSC as a result of this.
It belongs to the Binance exchange, whether it is Binance Chain or Binance Smart Chain. BEP2 standards for BC and BEP20 standards for BSC have been produced by these two blockchains. These standards give the various information required for the transactions of the various tokens. More information on these standards may be found by clicking here.