Crypto Global

Binance Smart Chain (BSC)

Mar 2, 2021

As the market capitalization of the crypto market increases, so does Total Value Locked (TVL) in its various DeFi protocols and applications. Still Ethereum is where we see most of the action in this niche. However, high gas charges on the Ethereum network have led some DeFi users to cheaper alternatives.

The fees have become unacceptable, especially for retail investors, making other platforms like the Binance Smart Chain more attractive. The open source nature of most DeFi protocols has allowed competing smart contract blockchains like the Binance Smart Chain to copy the same DeFi protocols Ethereum users are already familiar with.

Basically, what you should know about Binance Smart Chain (BSC) is that it is an inexpensive version of the Ethereum Virtual Machine (EVM) and is compatible with the EVM. Projects that arose from Ethereum can now also arise from the Binance Smart Chain. The BSC helps to get exposure that you might not otherwise get at the moment, and that allows you to grow much faster. With a TVL value of $9.6 billion, Binance Smart Chain already has more than a quarter of the Ethereum blockchain. BSC has grown rapidly in this regard and, unlike Ethereum, transaction fees are in the cent range, and on top of that, transactions can be executed faster than with Ethereum. The biggest downside is that the Binance Smart Chain is centralized at the highest level.

Both DeFi solutions have their advantages and disadvantages. One of our biggest problems with Binance Smart Chain is that it is obviously heavily funded and influenced by Binance. However, there is no question that people are actively using Binance Smart Chain as it is much more convenient and cheaper to use. The competition that Ethereum DeFi has received from others seems to have awakened the force to be reckoned with.