Bitcoin BEP2 in focus, bringing Bitcoin to Binance

Bitcoin BEP2 in focus, bringing Bitcoin to Binance

By Austras | Crypto in focus | 26 Oct 2021


Bitcoin is the world's largest crypto, and one of the highest valued assets by marketcap. It does have flaws and drawbacks, one of its major drawbacks is its difficulty to be implemented into Dapps & DEFI. Bitcoin BEP2 aims to fix this and bring the giant onto the Binance Chain and allow for smart contract usage. But how well does it perform and how does it work?

Background

Bitcoin BEP2 is as the name might suggest, Bitcoin on the Binance chain. The token was created by Binance and its founder Changpeng Zhao to allow for easier trading of Bitcoin. Binance launched in 2017 and quickly grew to be one of the world's biggest exchanges. This can be largely attributed their low trading fees and intuitive, but also to their own coin and accompanying smart contract chain.

The Binance Chain got further developed into the Binance Smart Chain that has one of the biggest ecosystem for tokens on the market. It was on Binance Chain that Bitcoin BEP2 was created in 2019. It allowed smart contracts and traders interact with Bitcoin while avoiding the fees or implementing Bitcoin's network. The project has stayed steady and garnered trust from traders.

Network

The project operates using smart contracts that adjusts the supply so that when demand rises/decreases the price stays stable towards Bitcoin. All Bitcoins on Bitcoin BEP2 is fully backed by a reserve which allows holders of the coin to exchange their BTCB for the equivalent in Bitcoin. Any user can verify and check this backing theirselves on this address at any given time. However, due to the fact that the BTC address is held by Binance and managed by them, this makes the token centralized, but easier to use and understand.

Use cases

Other than the smart contracts maintaining its price this token doesn't offer anything extra by itself. What it does do, is bring Bitcoin onto the Binance Chain. This means that investors can hold and trade Bitcoin without subjecting themselves to the trading fees associated with Bitcoin and instead pay the lower BEP trading fees. It also saves developers the pain and difficulty of having to add a blockchain to only support Bitcoin. Essentially this overcomes Bitcoin's weakness on DEFI and allows it to be easily used and traded in DEFI & Dapps.

Bitcoin BEP2 today

The token has a simple job, and it does it well. Binance has had a good reputation and their projects have been stable and strong performing. This gave Bitcoin BEP2 a healthy dose of trust when it first started and allowed for easy adoption. It has stayed stable and seen frequent use on the Binance Chain as the demand for DEFI increases. Bitcoin is the world's strongest performing crypto, Bitcoin BEP2 simply allows for further adoption.

Pros:
  • Smart contract stable peg
  • Stayed stable since launch
  • Allows for smart contract implementation
Cons:
  • Slim use case
  • Centralized

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Austras
Austras

Product manager & tutor, love learning & teaching others. || https://cointr.ee/dorfel


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