Posted 12 months ago | by Ben Armstrong

Binance to Launch Smart Contracts on New Blockchain

Leading cryptocurrency exchange Binance published a new whitepaper that details the development of Binance Smart Chain, which is a new blockchain running in parallel to Binance Chain which will support smart contract functionalities.

The new network is described as an innovative solution which brings both the interoperability and programmability of the Ethereum Virtual Machine (EVM) to Binance Chain.

It will run on a Proof-of-Stake consensus algorithm to aim to increase decentralization and community participation. The blockchain, moreover, will be EVM-compatible so that it can support all the existing tooling of Ethereum but with faster finality and cheaper transaction fees.

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Binance Creates New Platforms

Binance Smart Chain is a parallel blockchain that operates beside the current Binance Chain, and it aims to retain the high performance of native DEX while supporting smart contract functionality at the same time.

The Binance Chain Development Community (BCDC) commented in a press release:

“This dual-chain architecture will be ideal for users to take advantage of the fast trading on one side (Binance Chain) and build their decentralized apps with smart contracts on the other side (Binance Smart Chain). BNB holders who are interested in staking BNB can also support the development of Binance Smart Chain and earn rewards. In the long term, we hope to continue working closely with the blockchain community to strengthen our infrastructure for digital assets and provide the community with the best platforms for digital asset creation, circulation, and exchange.”

Built for Purpose

The build-out of a new blockchain network for smart contracts is a serious development.

Udi Wertheimer, the popular cryptocurrency commentator commented:

“Ethereum’s main weakness is its permissionless nature, which makes it inflexible and slow to change. Popular “dapps” on Ethereum are centralized anyway, so there’s not much to gain from having a permissionless infrastructure.

Binance, Tron, and others are taking advantage by taking Ethereum’s most popular component – the EVM – and putting it in a system that is flexible and can adapt to market changes quickly.
For “dapp” developers it is easy to migrate to these EVM-based networks, so we will find out soon if there’s value in them for developers.”

Binance is entering a competitive field which has Ethereum dominated for quite some time.

According to a report from 2019, Ethereum, TRON, and EOS account for 98% of all the decentralized applications that exist today. Ethereum takes the top spot in several categories, including active dApps, active users, and transactional volume.

According to DApp Rankings By Platform, numbers from the State of the Dapps reveal that Ethereum continues to lead in 2020, though it’s still relatively early to produce meaningful statistics.