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Binance launches $ 1 Bn fund for BSC development

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The Binance exchange announced a massive $ 1 billion investment to finance Binance Smart Chain. The blockchain launched a year ago to develop decentralized dapps through smart contracts is a sort of low-cost competitor of the most famous blockchain of Ethereum.

Binance and the fund to finance BSC

This fund will go to increase the potential of the blockchain, initially funded with a $ 100 million fund.

This new 1 billion fund should be split into four different areas: Talent Development, Liquidity Incentive Program, Builder Program, Investment & Incubation Program. The first two areas should be funded with approximately $ 100 million each, while $ 300 million would go to the Builder program and $ 500 million to the investment program.

The company’s tweet reads:

Time to Accelerate #BinanceSmartChain’s Journey to Scalability and Mass Adoption We announce the largest growth fund in cryptocurrency history: the $ 1 billion fund to drive adoption of not just BSC but the whole blockchain industry “.

Binance Smart Chain challenges Ethereum

Binance Smart Chain was launched in September 2020 with a budget of 100 million dollars to support and develop decentralized dapps, as does Ethereum, but at significantly cheaper costs.

From the beginning the new blockchain has had explosive success, supporting and developing more than 200 decentralized finance start-ups. There are about 1 million daily active users on the platform spread over about 900 dapp currently present.

One of the most important decentralized exchanges built on BSC is PancakeSwap which would have reached a total blocked value (TVL) of approximately $ 9.8 billion according to data from Defi Station.

This massive investment will make BSC the leading ecosystem for decentralized dapps and startups making it “The most inclusive and used blockchain infrastructure in the world, creating the new Internet of Value for all”.

Binance
New fund for BSC

Ethereum vs BSC

Binance Smart Chain was created as alternative to Ethereum, to solve the problems related to the speed of transactions and the high cost of the same.

Exactly for this reason the two blockchains they have many points in common. BSC-based DApps and tokens are compatible with Ethereum Virtual Machine (EVM). The addresses of the public wallet of Bsc users are the same as those of Ethereum.

There are also many differences.

The first concerns the size of the two chains. On Ethereum there are about 2900 dapps while on Bsc just over 800. According to Dappradar in the second quarter of 2021 BSC has become the defi dominant blockchain. In June, Bsc’s average transactions were over 4 million per day against about 1.7 million transactions on Ethereum.

Among the main reasons for this exponential growth we can mention the faster confirmation times and the much lower commissions. The growth of BSC is also due to the massive growth of the projects related to NFTs and its compatibility with popular crypto wallets, such as Trust Wallet and MetaMask.

One of the other differences between the two systems is the one linked to the consensus mechanism, which is the classic one POW (proof of work) for Ethereum, while for BSC it is the new system LAYING (proof of staked authority).

The system is based on 21 validators who take turns to produce blocks and receive BNB transaction fees as a reward. Every 24 hours the whole process is repeated with 21 other validators, elected after having solved a node or made it staking of at least 10,000 Bnb. This system allows for much faster and cheaper transactions.


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