What is Binance Smart Chain (BSC) and BEP-20 Token
Binance Smart Chain or commonly known as BSC BEP-20 is currently one of the strongest competitors to Ethereum (ERC-20). Before learning what BSC has to offer, it is important to understand that the meaning of Binance Smart Chain is different from Binance Chain (BEP-2). Binance Chain (BEP-2) was first launched in April 2019 with a primary focus on facilitating precise and decentralized trading. To do this, Binance Chain must create several features related to the operation of the blockchain system. Due to the limitations of these options, Binance Chain (BEP-2) does not have much flexibility.
Because running smart contracts on a system optimized for fast trading of crypto assets can significantly congest the network. Binance Chain (BEP-2) needed to evolve to be able to handle requests from many users, which is why the idea of creating Binance Smart Chain (BSC) originated. So what is Binance Smart Chain? How does it work?
Understanding Binance Smart Chain (BSC)
The goal is to leave the high throughput of Binance Chain (BEP-2) intact while introducing smart contracts to its ecosystem and encouraging the adoption of decentralized applications (DApps). In fact, blockchain operates continuously. Also keep in mind that Binance Smart Chain (BSC) is not a second layer or off-chain scalability solution. This off-chain is an independent blockchain that can run, even if Binance Chain (BEP-2) is offline. In addition, because BSC is compatible with EVM, Binance Smart Chain was launched with support for operating Ethereum tools and applications. In general, this makes crypto assets running on the Binance Smart Chain network easy for developers to migrate their projects from Ethereum. Meanwhile, for investors or traders, Ethereum applications such as MetaMask can easily be set up and added custom BSC networks.
Concept of How Binance Smart Chain (BSC) and BEP-20 Token Work
1. Consensus
Binance Smart Chain (BSC) uses Proof of Staked Authority (PoSA), where developers and users use BNB staking as a transaction validator. If they propose a valid block, they will receive network fees from the BSC crypto asset transactions included in it. Unlike other blockchain protocols, there is no block subsidy for newly minted BNB because BNB is non-inflationary. Conversely, the supply of BNB will decrease over time as BNB purchase transactions progress, as the Binance team regularly burns BNB coins.
2. Cross-Chain Compatibility
Binance Smart Chain (BSC) is likened to an independent but complementary system to the existing Binance Chain (BEP-2). The dual-chain architecture is used for the reason that traders or investors can transfer their crypto assets easily from one blockchain to another. With this method, trading can be enjoyed easily on the Binance Chain (BEP-2) network, while powerful decentralized applications (DApp) can be built on the Binance Smart Chain network. Through this interoperability, users are faced with a broad ecosystem that can fulfill various use cases. Crypto token assets running on the BEP-2 and BEP-8 networks of Binance Chain can be converted into BEP-20. The newest Binance token standard introduced and used for Binance Smart Chain (BSC) because it has the same function as Ethereum (ERC-20).
if you wanna read more about binance, please go visit this link :
https://www.binance.com
