Binance – The world’s biggest crypto exchange recently celebrated its 5th birthday. And its CEO CZ took us back to how it all started and what did they learn from the bear markets.
In fact, CZ said a very noteworthy statement. He said “Businesses that start in a bear market are the Strongest” How did Binance survive through these bear markets and what is it building in the 2022 bear market?
The Beginnings of Binance
Binance started back in 2017. If you were here then, then I’m sure you remember the ICO craze of this period. New coins were listed and sold on ETH. ICOs were selling out in minutes.
And some huge projects including the BNB Coin launched in this way. Then, BNB’s launch was successful too with half its tokens sold at ~ 15 cents each. Those 15-cent tokens are worth $216 each now and BNB is the #5 project in crypto. But it wasn’t all a straight line.
— Binance (@binance) July 14, 2022
First, the launch was on ETH like all ICOs were at the time. That means BNB was an ERC-20 token. But they soon transferred it to what is now the Binance Beacon Chain, which is their blockchain built on Cosmos.
Second, before the token gained utility in many areas including payments, staking, and use in launchpads, BNB’s only role was to help lower trading fees on its exchange.
Third, it, like most ICOs was not without controversy. Many of those ICOs were illegal securities sales now that we can look back on them. Also, Binance has to deal with law enforcement regularly as rumors of laundering funds are continuous. That said, these are some of the headaches that come from being the biggest.
More About Binance
And that’s just one of Binance’s two blockchains. What used to be the Binance Smart Chain (BSC) and is now the BNB Smart Chain started in 2020.
The idea was to create an EVM that brings fees down and is faster for apps. What Binance did here, and this was an ingenious design, is have this on a separate chain from their exchange operations and staking, which they do on the main chain. Binance was one of the first to do 2 chains to 2 sets of applications and use cases. Now, this is a pretty common feature in larger projects.
Along with its EVM, when Binance wants to be able to connect or bridge to other chains, all of that is done through the BNB Chain as well.
Moreover, one last important feature of BNB Smart Chain is the token standard they use, BEP-20. BEP-20 is a fork of ETH’s ERC-20 and is compatible. They even use the same deposit addresses. This helped BNB Chain apps like PancakeSwap increase adoption faster. Gas fees are lower, the chain is faster, and it does more transactions per second than Ethereum.
In this guide:
✅ What's a BEP20 token?
✅ How to withdraw BEP20
✅ What you can do with BEP20 tokenshttps://t.co/ajOp5UlU7T
— Binance (@binance) April 24, 2021
Also, the Beacon Chain has its native token standard too, BEP-2 and BEP-20 are usable on the Binance exchange but you have to make sure you are sending coins to the right address and chain. They are not interchangeable with each other.
What Other Reasons Made Binance So Successful in 5 Years?
Binance works the angle of customer convenience and what’s good for customers better than any other exchange. And they show this through actions like:
- Trading Services available on their exchange
- Funding methods for their exchange
- Numbers of coins and contracts listed
- Customer-friendly services
Binance has made convenience and accesses its 2 main goals:
Like all CEXes, they try to make it easy to go between fiat and crypto. That’s nothing new or innovative. All the best platforms do that. But what Binance did with its exchange was expand this idea into convenience for other services too. Trade options, futures, P2P trading, access to new projects, a debit card linked to the account, and a paid feature.
Now, these things don’t sound like that big a deal anymore because many exchanges like Kucoin, Gate.io, MEXC, and others offer some or most of these services too. But Binance was first and it offers all of them. That’s how they became the biggest so fast.
But what about countries in Latin America, South Africa, or India? There, people have an interest in crypto but capital controls are severe. The markets there are big enough but the fiat on-ramps are challenging. P2P Trading is the key to this. This enables someone in Bogota or Johannesburg to buy with their local funds from an independent seller giving them the on-ramp they need.
What are the benefits of using #Binance P2P?
Here are five reasons why you might want to try P2P trading. pic.twitter.com/D4Yyal62tH
— Binance (@binance) July 1, 2022
Anyone that can make it easier to exchange pesos, rand, naira, or rupees is going to be a winner in crypto. And Binance does, and they are.
The last big advantage of Binance is its ecosystem. It’s huge. First, they are encouraging the building of sidechains through their BAS system. BAS is BNB Application Sidechain. No question this helps the BNB coin and the ecosystem grow. This is a more recent development so this is an area we are watching closely.
Next, they are leaders in DeFi. PancakeSwap is one of the industry’s biggest DEXes. There are many great apps for farming, staking, yield optimization, and credit and insurance too.
Also, Binance has over 3 million active weekly users completing 27.3 million transactions. That is a LOT of money moving around. They have almost 1 million daily active users and the average total transaction is $4 million daily.
— BNB Swap (@BNBSwap) March 31, 2021
Moreover, they are growing in the important areas of NFTs, Gaming, Metaverse, as well as Derivatives. And they are improving ecosystem infrastructure with block explorers and their Binance Labs unit to cultivate and fund new projects. There are over 1300 dApps in total. It’s amazing how fast they’ve grown.
What is Binance Building in 2022
If you take a look at Binance 2022 technological roadmap, it is packed with major updates deployed on the mainnet before the end of this year. On BSC, the team is working on increasing the block gas capacity which in simple words means faster transactions, low cost, and extra capacity.
The work has been going on since Q1 and by the end of Q3 2022. BSC will have its block gas capacity increased until it reaches a 200 million gas cap. So, users will enjoy more capacity, lesser congestion, and faster transaction confirmation times. That means as BSC users you will be able to fill more transactions into a single block and avoid high fees caused by network congestion.
On the other hand, the next big upgrade will be BAS or BNB Application Sidechain as we discussed in the earlier segment. Somewhere in Q3 of 2022, the BAS framework will go live. This will enable the development of new dApps on this new high-performance infrastructure. which will come with a full Ethereum compatibility (EVM) and operate on the PoSA consensus.
Also, the team is simultaneously working on a native bridge between BAS and the BSC Mainnet. This will allow frictionless bridging for BEP-20 and BEP-121 tokens (tokens built on sidechains).
🎉 @CelerNetwork Overview & Ecosystem🚀
— BSCDaily (@bsc_daily) June 2, 2022
Finally, the next phase would be the development of next-generation sidechains that would support 10,000 tps. This will be a layer of improvement on the BAS infrastructure and will be based on ZK-rollup-based applications that will run on their dedicated sidechain. Undoubtedly, Binance is making some big bold moves there.
It’s amazing what Binance has accomplished in 5 years. The biggest, most successful, most respected centralized exchange. It’s the biggest EVM-based ecosystem outside ETH. It has 2 successful blockchains with over 1000 dApps where people worldwide can have access to crypto with very few limits based on their residency or citizenship.
All that in 5 years. Happy Birthday, Binance!
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