Binance Smart Chain (BSC) is a blockchain-based decentralized exchange platform that allows anyone to build and launch their own digital token. The platform offers its users a rich, rapidly growing ecosystem of digital assets.
As a major crypto exchange in the world, Binance has always been committed to increasing the adoption of blockchain technology. In order to reach this goal, Binance has announced that it is creating a decentralized exchange (DEX) named Binance Chain and is developing its own smart contract platform called the Binance Smart Chain (BSC).
The Binance Smart Chain BEP20 interconnection sets some strong precedents for creating autonomous blockchain platforms to facilitate web3 development. The Binance Chain was launched in order to enable faster transactions on the Binance exchange, but it created issues around network congestion.
The flexibility of the Binance Chain for allowing faster transactions led to a need for a platform that could accommodate smart contracts alongside automated transactions; this need was met by the introduction of Binance Smart Chain (BSC), which is the foundation for the DEX project of Binance.
Dual Chain Architecture
Binance’s dual-chain architecture is a major step forward in blockchain technology.
Binance Chain is a private chain that runs on Ethereum Virtual Machine and can be used to port dApps or use MetaMask to interact with it seamlessly. The public chain, Binance Smart Chain Protocol (BSC), is a variant of Ethereum’s proof-of-stake algorithm that uses BNB coins to power the network. Validators must stake BNB coins and validate blocks in order to secure the network, earn transaction fees from every block they validate, and receive incentives for doing so. As Binance conducts regular coin burns to reduce supply and increase value, these incentives become even more attractive for holders.
BEP2 and BEP20
You might be wondering, “What are BEP2 and BEP20 tokens?”
They’re the two different token standards that you’ll need to use depending on which chain you want to interact with.
Binance Chain uses its native BEP2 tokens on its blockchain ecosystem, but if you want to interact with any dApps on the platform, then you’ll need to use the BEP20 token.
Binance Smart Chain uses the BEP20 token as well, but it also supports Binance DEX and other decentralized exchange protocols. It is important to note that both of these chains are compatible with each other so that they can be used seamlessly together — you don’t need to worry about having to choose one or another.
Parameters in BEP20 Token Standard
The definition of BEP20 tokens may seem straightforward, but understanding the different standards and parameters behind them can help you determine which functions they will have in your project. The parameters include:
The “Blacklist” parameter helps to blacklist or ban a dubious token address or other malicious addresses.
- Can Mint
The “Can Mint” parameter serves as the inflationary parameter for the BEP20 standard, providing specifications regarding possibilities for minting new tokens to increase the supply.
- Can Burn
In contrast, the “Can Burn” parameter is a deflationary component of the BEP20 standard and can be used to burn tokens, reducing supply.
- Can Pause
The “Can Pause” parameter is an innovative and useful safeguard against malicious attacks. In event of any malicious attack or network downtime, users can pause all operations on the BEP20-based platform until further notice. However, this mechanism is centralized and requires approval from a system administrator before it can be enacted by users.
Next we will compare BEP20 with ERC20, highlight their key differences and take a look at the several BEP20-based Projects.
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