All pointers suggest that Binance, under the guidance of Changpeng Zhao, is going for the jugular and are keen on competing with Ethereum.
They recently released the white paper of the Binance Chain, a blockchain platform that they claim will not only be decentralized but its virtual machine will be compatible with Ethereum.
Thing is, Ethereum is the kingpin in smart contracting and is a market leader.
However, space is heating and competitors are stepping up, rolling out platforms that resolve some of Ethereum’s core fallibilities like scalability. Ethereum is based on the Proof-of-Work consensus algorithm and is satisfactorily decentralized.
For decentralization and security, the network creators have to contend with scalability troubles barring high demand applications like social media platforms from launching on the platform without straining the core.
Details from Binance Smart Chain White Paper
Now, Binance Chain, gleaning from its white paper, promises more.
An extract reads that the chain will not only be compatible with Ethereum but it will be easy for decentralized applications, dapps, to migrate to Binance with zero or minimal changes.
“To take advantage of the relatively mature applications and community, BSC chooses to be compatible with the existing Ethereum mainnet. This means most of the dApps, ecosystem components, and tooling will work with BSC and require zero or minimum changes.”
Binance, has over the years, been trying to price away promising dapps from the Ethereum platform to the Binance chain.
The most important part of Binance Chain's new whitepaper. It is compatible with Ethereum to make sure the Ethereum dApps are compatible with Binance Chain with "zero or minimum changes." Now with smart contract support, Binance Chain is fully taking on Ethereum pic.twitter.com/zWIOqZSAwx
— Larry Cermak (@lawmaster) April 17, 2020
But the introduction of smart contracting capability means that the tables are turning. Binance, could as well turn out to be a real threat, a “killer”, of Ethereum.
Their virtual machine will be based on Tendermint and the new chain will run parallel to the Binance chain, an ecosystem that continues to be built from 2019 which comprises a decentralized exchange, DEX, where several tokens are traded.
For ease, both chains can seamlessly communicate. Besides, it will allow staking as the new chain, BSC, seeks to combine decentralized Proof-of-Stake, a variant of Proof-of-Stake, and Proof-of-Authority (PoA).
The only coin allowed for staking will be BNB.
Binance delisted ETH Pairs in 2019
It only makes sense that Binance is doing this now. Last year, Binance was lambasted for delisting ETH pairs while pushing BNB.
“There was some kind of partnership with Binance with developing the exchange and Binance had as a condition to delist or not list ETH pairs so BNB gets pushed. I think this might be the reason, no hard proof though.”
There was some kind of partnership with Binance with devlopng the exchange and Binance had as condition to delist or not list ETh pairs so BNB gets pushed. I think this might be the reason, no hard proof tho.
— Zabi D.?️ (@zabisara) March 19, 2020
It was even said the exchange approached teams and urged them to migrate to the Binance Chain.
Binance should be lauded
Still, nothing can be taken away from Binance. The exchange has grown to be one of the largest in the world just three years after launching. Earlier this month, they acquired CoinMarketCap, a coin tracker for a whopping $400 million.
They also have their tentacles around the globe including South Africa and the Caribbean enabling the trading of crypto-fiat, margin, and derivatives contracts.