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How Could Binance Onboard Billions of Users through Binance Chain: The Technical Perspective

The world leading cryptocurrency exchange Binance has launched the testnet of its new decentralized exchange Binance DEX on Feb. 20, but related information is rare. Many crypto enthusiasts want to know more about how Binance DEX will work and what features will be available. Today we are going to discuss these issues from a technical perspective.

As we all know, Binance DEX is built on top of Binance Chain, so before we get into the DEX, we need to talk about Binance Chain first. Binance’s native currency Binance Coin (BNB) is an ERC20 based token that currency runs on Ethereum chain, but it would be moved to its main chain after Binance Chain being officially launched.

After several iterations, the current implementation of Binance Chain is mainly built on forks of Tendermint and Cosmos SDK. According to an acknowledgment of Binance Chain in GitHub:

“We make use of a revised edition of Tendermint consensus and leverage its p2p networking logic, and Cosmos SDK features such as its ‘bank’ is used for basic token transactions.

Projects like Binance Chain and Binance DEX are often built as forks of Bitcoin or as smart contracts on platforms like Ethereum. With a foundation of clean, well-structured code from Cosmos SDK, we were able to build on a codebase that we saw as a better alternative.”

Based on this description, we can know that Binance Chain will adopt a modified Tendermint PoS algorithm, which is quite meaningful as it enables users to hold their own BNB while ensuring the new blocks is determined by the major nodes.

From to the information resources spread on the internet, a blog post of decentralized exchange Saturn Network listed 4 key summaries of Binance Chain :

1.Binance DEX will be integrated into a Trust Web Wallet, the native integration of Binance DEX and credit card purchases into Trust Wallet will allow Binance to tap into the merging mobile market which will be the next core business movement of Binance.

2.Binance DEX will integrate with the centralized Binance exchange, which means they would share the trading depth and liquidity theoretically.

3.Binance Chain will support token creation but will not support smart contracts, which will largely limit its use cases and token types it supports. Combined with Binance Launchpad, this chain will be great for launching security tokens.

4.Binance DEX will support all tokens listed in Binance.

Instead of taking the place of the original centralized Binance exchange, Binance is about to replace the user account model with asymmetric cryptography which enables users to hold their own private keys and manage their own wallet. This new authentication mechanism will supplement Binance’s existing account model and making interactions between users and the exchange becomes smoother and more secure and gains more customers.

Obviously, both the Binance Chain and Binance DEX will be the next strategic products of Binance, with the purpose to expand its market boundary as well as increase its market share. In addition, the Tendermint consensus and Cosmos SDK features enable crypto enthusiast to update the progress of this project and become the witness of the DEX evolution in the crypto world.

COMMENTS(2)

  • Brian
    7 months ago Brian

    Tron’s Justin Sun: Crypto Bear Market Has Come to An End – 8BTChttps://news.8btc.com/trons-justin-sun-crypto-bear-market-has-come-to-an-end …

  • 8BTCnews
    7 months ago 8BTCnews

    Tron’s Justin Sun: #Crypto Bear Market Has Come to An End
    #tron @justinsuntron @Tronfoundation @TRONDApps @lovethetuff @JoshuaJBouw @mishalederman @johniadeluca @ElecProNeuTRON @cz_binance #binance ,https://news.8btc.com/trons-justin-sun-crypto-bear-market-has-come-to-an-end …

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