Binance, the largest cryptocurrency exchange by trading volume, has announced that it will launch a new Ethereum-compatible blockchain.
According to the report, the new blockchain will use Binance Coin (BNB) as a native token. Named “Binance Smart Chain (BSC)”, which would have smart contracts functionalities, such as Ethereum.
Going by the whitepaper recently published by Binance, “The first practical and widely-used Smart Contract platform is Ethereum. To take advantage of the relatively mature applications and community, BSC chooses to be compatible with the existing Ethereum mainnet.”
The Binance Chain (BC) already owned by Binance will join the new blockchain, Binance Smart Chain (BSC), to allow transfers and other communication, owing to the native support of interoperability.
According to the crypto exchange, the Binance decentralized exchange (DEX) will remain a liquid exchange venue of assets on both chains.
“The Binance DEX will remain a liquid exchange venue of assets on both chains. This dual-chain architecture will empower its users to build their decentralized apps and digital assets on one blockchain and take advantage of the fast trading to exchange on the other.”
According to Binance, the proposed solution will merge the best of the two innovations together. The exchange furthered that “The fast block times and cheap transaction costs are great news for users who will be able to transfer their assets in a shorter time for surprisingly low transaction fees.”
The new blockchain is also a big opportunity for BNB holders who have an interest in staking their BNB holdings to support the development of Binance Smart Chain (BSC) and earn rewards.
This new technology will have Ethereum to compete with, because it will support all of the existing Ethereum tooling, including the faster and cheaper transactions.