As decentralized currencies evolve in a competitive world, running a cryptocurrency exchange has become a lucrative business. One of the growing cryptocurrency exchanges, Binance, is about to launch its own blockchain. This native blockchain will be called Binance Chain. It will be used to back a decentralized exchange within the Binance ecosystem.
Binance Ventures into the Decentralized Exchange Space
According to company’s official blog, the “Centralized and Decentralized exchanges will co-exist soon, complementing each other, while also having interdependence. As Such, we have decided to officially launch the development of the Binance Chain. By developing Binance Chain, the exchange intends to enhance users’ trading experience on the Binance platform, focusing on the future flow of blockchain assets. Trading effectiveness is also an enhancement Binance is looking at on its decentralized exchange venture.
Additionally, Binance Coin (BNB) which is Binance’s native token on the Ethereum Network, will be upgraded to become a coin, with its own blockchain main net. The transactions under centralized networks are updated and stored on the server. Binance’s BNB tokens are ERC20, but they don’t always depend on the Ethereum network. Transactions with them can be settled off-chain, offline when BNB transactions take place on Binance itself.
Freedom of Choice and investment
The exchange is stepping up its present trading approach from tight control to a Binance Chain-powered decentralized exchange in coming months. As per Changpeng Zhao, Binance founder and CEO, “On the decentralized exchange we’ll have less control. More likely anybody can list any coin.” He also added that “That’s the philosophy of the decentralized exchange, it’s freedom of choice, freedom of investments. But with freedom there will be people who are scammers. That’s not something we can control.”
Anonymity and Security Beyond Speed and Liquidity
Binance became the world’s most popular cryptocurrency exchange platform in just six months. The news comes in the wake of Binance’s recent announcement of a $250000 bounty for information that leads to the arrest of the hackers responsible for the March 7th hacking attempt. In the meantime, the CEO of the company, tweeted that Binance Chain and the existing centralized exchange will work side by side. The new decentralized exchange can also be used as a launchpad for ICOs. Nonetheless BNB tokens are now in use to make investment under the ecosystem.
The decentralized exchange will have higher fees than the centralized platform since it requires more computing power from various computers to verify and record trades. Zhao said, Binance Chain is a great fit for those who are concerned with anonymity and security beyond speed and liquidity. Besides decentralized trading system, Binance is also moving ahead with the development of a wallet to store user funds. Developers are encouraged to build supporting products for its new platform. Zhao said, the software will be installed in user’s computer and the user will be able to control it.