According to a blog post, Binance will issue new BEP2 tokens that will be available on both of its trading platforms. Why? We are about to find out below.
Binance will start by issuing BTCB in the coming days. The token will be pegged to Bitcoin. Each token will have a BTC trading pair.
Why is Binace issuing cryptocurrency pegged tokens?
By issuing a BTC pegged token, Binance expects an increase in its trading volume. It may not be too big of a deal for its old exchange, however, it will be very beneficial for its new DEX.
I think it can be quiet handy to own a BTC pegged token for faster transactions.
Binance is looking to issue a token for each leading cryptocurrency.
Binance also says:
“While this approach is more centralized than atomic swaps, we believe it provides a higher degree of ease-of-use to most traders. And most traders are already trusting Binance.com to hold their funds anyway. Compared to fiat tethering, crypto can provide a high degree of transparency so that anyone can audit the reserves publicly, any time they want.
We note that this centralized approach is not exclusive to cross-chain atomic swaps or other decentralized approaches, which can also be implemented in parallel. There are a few atomic swap solutions already being developed as we write this, and we always welcome more developers to join.”
The leading crypto exchange claims that the tokens will be 100% backed by Bitcoin.
Binance is also encouraging teams to issue tokens that are pegged to their cryptocurrency on the Binance chain.