The world’s largest cryptocurrency exchange, Binance has taken another firm step toward improving its infrastructure. In a bid to make the platform more inclusive, it has launched the second edition of its cross-chain protocol.
The new edition is called Binance Bridge 2.0 and it will connect both listed and select non-listed tokens from the Ethereum blockchain to the BNB Smart Chain. It aims to give traders direct access to DeFi on BNB’s chain.
What is it?
Binance is the world’s largest cryptocurrency exchange in terms of volume exchanged on a regular basis. Its flagship layer one chain is the BNB Chain or the BNN Smart Chain. The new update is an attempt to improve the existing chain by making it inclusive of non-listed tokens as well.
Named Binance Bridge 2.0, the blockchain bridge will allow users to bridge listed and unlisted tokens on the BNB Smart Chain. Users will be able to use a wide variety of tokens within the BNB chain such as DeFi, CeFi, and the metaverse.
Binance Bridge 2.0 replaces the decommissioned Binance Bridge and is essentially a repurposed version of it with more features and a new look. It aims to make the transition from Ethereum to BNB Chain easier for users.
Though the reports are claiming that Binance Bridge 2.0 will be supporting ‘almost all’ Ethereum tokens, the press release does mention ‘select’ non-listed tokens. It is advisable for traders to look up what they can actually trade and what they cannot on the app and its help center before actually trading.
How does it benefit you?
As a user of the Binance app, there are many benefits you can enjoy with the new update being rolled out, as stated by the firm in its press release regarding Binance Bridge 2.0. The first of which is a wider variety of blockchains that you will now be able to access.
You can trade with the traditional centralized finance (CeFi) along with decentralized finance (DeFi). You may know that centralized finance refers to financial activities of any nature governed by an authority or exchange, whereas a DeFi finance is not governed by any intermediaries or authorities.
Ethereum has been the leading blockchain for DeFi. By allowing integration with the unlisted tokens of Ethereum, Binance opens doors to new opportunities for investors. The unlisted tokens brought to the BNB Chain will be called BTokens
The process will be easy to follow for traders with an enhanced user experience. Binance also claims that the new update will result in decreasing maintenance costs for traders, thanks to the increased interoperability between various blockchains.
Features to watch out
By allowing traders to manage all the functions through its singular app, Binance is removing the need for reliance on any third-party wallets, lowering the costs for traders in the process. It is both an easy and inexpensive option for investors.
The listed tokens can be found in your Funding wallet on the Binance platform whereas the unlisted ones will be deposited in the newly formed self-custody wallet (SCW). You will not have to worry about getting your listed and non-listed tokens mixed up.
You may check your app to find the new wallet. If you don’t find it, let the app know and it will guide you through getting one. The SCW wallet is well-protected as only you hold the private keys.
Security, in general, has seen an upgrade in the new addition. In its own words, the Binance Bridge 2.0 is a trusted bridge that is protected by the highest security protocols of the app.
It also guarantees a transaction time of just 3 seconds per transaction. Binance states that it hopes to provide support to more blockchains and dApps in the future.
Trading with the help of wrapping and automation
The process being used by the Binance Bridge 2.0 to allow tokens on its blockchain is called wrapping. It is a prominent method used to allow unlisted and unsupported cryptocurrencies such as Ethereum and Bitcoin on a DeFi platform.
The process involves creating new tokens that represent the value of the unlisted tokens. In Binance Bridge 2.0, the BTokens are the tokens that represent the same value as some underlying asset by mirroring them.
You may wrap ERC tokens to get BEB BTokens. They can then be easily used on the BNB Chain and regulated via the DeFi protocols. You will not have to resort to swaps or pay high fees to trade them. Neither will you have to endure a long waiting time to complete your transaction.
Most importantly, all BTokens are pegged on a ratio of 1:1 with the underlying assets. There is absolutely no loss in value in jumping platforms. Lastly, you can turn your BToken back to the original asset at any point.
With the help of such effortless wrapping technology at your disposal, you can make tremendous improvements in your trading. You may pair it up with your automation strategies to make big gains in the market. With help of a proper guide, you can create a custom Binance trading bot to minimize risk and trade with a wider variety of assets. The key is to formulate a strategy that suits your needs and your risk tolerance. It’s a faster and more reliable approach to navigating the market.
Binance is continuing to improve its infrastructure with the new update of Binance Bridge 2.0. Already the largest cryptocurrency exchange in the world, the new edition aims to include the unlisted token on the app as well.
Traders can now access both DeFi and CeFi tokens on the Binance app with the help of wrapping. It essentially mirrors the unlisted tokens to become BTokens and be used under the DeFi protocol on its platform.
The move opens up new opportunities for traders to make big gains in the market, they will not have to rely on third-party wallets for wrapping as they can get all the needed help on the all-encompassing platform of Binance.
This is a Sponsored Feature.