Binance’s multi-chain strategy is confusing to say the least. With the introduction of Binance Smart Chain after Binance Chain, and then rebranding both chains to distance itself from Binance.com, it has only created more confusion for users interested in Binance’s ecosystem.
The Binance ecosystem is now labelled BNB Chain, which helps unify both of its chains, BNB Beacon Chain and BNB Smart Chain. While Binance wanted to offer the fastest transaction speeds initially with minimal complexity through its Binance Chain, the crypto scenario evolved beyond expectations. This compelled Binance to join the race for modifiable and open ecosystems through its Binance Smart Chain, which offers smart contracts and decentralized applications (dApps).
Let’s explore the complex yet fascinating world of Binance’s ecosystem and how everything culminated into a single BNB Chain with the passage of time.
What is Binance Chain?
Binance Chain (now BNB Beacon Chain) was launched in 2019 for fast and efficient token trading and to power the Binance Decentralized Exchange (DEX). It was created with the following features in mind.
Speed: Binance Chain’s primary function was ultra-fast transactions, making it ideal for speed-first trading environments.
Binance DEX Backbone: Binance Chain serves as a foundation for Binance DEX. This allows users to trade crypto assets directly from their wallets in a decentralized manner.
No Smart Contracts: Unlike Binance Smart Chain, Binance Chain doesn’t support smart contracts. This is a deliberate choice aimed at increasing performance and reducing complexity.
Performance: The architecture of Binance Chain is optimized for throughput and low latency, making it lean and efficient.
What is Binance Smart Chain (BSC)
Binance Smart Chain (BSC) was launched in September 2020 by Binance to expand its ecosystem beyond trading and step into the world of smart contracts, DeFi, and NFTs. BSC has the following core functionalities.
EVM-Compatible: BSC is fully compatible with the Ethereum Virtual Machine (EVM). This allows developers to easily port Ethereum-based dApps to BSC with minimal changes.
Smart Contracts and dApps: Unlike its predecessor, Binance Chain, BSC supports programmable smart contracts. This enables a wide range of decentralized applications, from DeFi platforms to NFT marketplaces.
Proof-of-Staked Authority: BSC uses a unique consensus model called PoSA, which combines the elements of both Proof of Stake and Proof of Authority. This enables fast block times, low transaction fees, and a more energy-efficient network.
Dual-Chain Architecture: BSC operates in parallel with the original Binance Chain (now known as the BNB Beacon Chain). This enables seamless asset transfers between chains while leveraging the benefits of both speed and programmability.
BSC has become a hub for web3 innovations by hosting thousands of dApps and billions in TVL. It is considered a popular alternative to Ethereum due to its low fees and high throughput, especially during the times og congestion.
From Binance to BNB Chain: The Rebranding
In February 2022, Binance unified Binance Chain and Binance Smart Chain under a new banner, BNB Chain. This rebrand wasn’t just cosmetic, but it also marked a shift in philosophy and direction for Binance.
Binance Chain —> BNB Beacon Chain (focused on governance and staking)
Binance Smart Chain —> BNB Smart Chain (focused on smart contracts and dApps)
BNB Beacon Chain + BNB Smart Chain —> BNB Chain Ecosystem (where BNB stands for Build and Build)
One of the main reasons for rebranding was that Binance wanted to distance its blockchain infrastructure from Binance.com, the central exchange. This signaled that the BNB chain is community-driven and open-source, not a corporate entity.
The rebranding also aligned with Binance’s MetaFi vision, a place where metadata and DeFi fuse. MetaFi encompasses GameFi, SocialFi, NFTs, and Web3, with BNB Chain at its heart.
The rebrand also came with a plethora of technical enhancements. The validator set was expanded from 21 to 41, and throughput was boosted to support large-scale applications like blockchain games.
Binance Chain vs Binance Smart Chain: Key Differences
Binance Chain and Binance Smart Chain are two distinct yet complementary networks developed by Binance. While one focuses on the speed of transactions, teh other is all about technical modifications. We have listed the differences in detail below to help you understand the difference between the two chains.
| Feature | Binance Chain | Binance Smart Chain |
| Smart Contract Capability | No | Yes, EVM-compatible |
| Consensus and Security | Tendermint-based BFT, Resistant to forks and double-spending | Proof of Staked Authority (PoSA) |
| Developer Ecosystem | Smaller developer community with fewer open-source projects | Developer Friendly with BSC Grants Program |
| Network Speed and Transaction Cost | Fast and low | Slower than BC and low |
| Wallet and Tooling Support | Trust Wallet Support, Binance Chain Wallet, Custom & Limited SDKs, Binance Chain Explorer | MetaMask Support, Trust Wallet Support, Binance Chain Wallet, Ethereum Compatible SDKs, BscScan |
| Token Transfers and Interoperability | BEP-2, Starts with bnb, fast asset transfer, DEX | BEP-20, starts with 0x, smart contracts, DeFi, dApps |
| Governance | DPoS | PoSA |
Smart Contract Capability
Binance Smart Chain is EVM-compatible, allowing developers to deploy Ethereum-based smart contracts directly onto it. This enables a rich ecosystem of decentralized applications, like DeFi platforms and NFT marketplaces. This allows BSC to use BEP-20 to create programmable tokens.
On the other hand, Binance Chain doesn’t support smart contracts or EVM. This means it can’t host dApps, and the only token standards allowed are BER-2 and BEP-8. These standards allow fast transfer but no programmability.
Consensus and Security
Binance Chain uses Byzantine Fault Tolerance (BFT) via the Tendermint Core engine. It is usually limited to a small, fixed set of validators (often < 20), and achieves instant finality. Once a block is committed, it can’t be reversed. It is resistant to forks and double-spending, and fewer validators mean faster consensus but lower decentralization.
Binance Smart Chain, on the other hand, uses a hybrid of Proof of Stake and Authority (PoSA), where validators are elected based on staking and reputation. It can have around 21 active validators at any time. BSC has fast block times (~3 seconds) with probabilistic finality, which means blocks are considered final after a few confirmations. It relies on validator honesty and stake-based incentives for security, and governance is more centralized compared to fully open PoS systems.
Developer Ecosystem
Binance Smart Chain is fully compatible with Ethereum tools like Remix, Truffle, Hardhat, and MetaMask. BSC supports BEP-20 tokens, which mirror Ethereum’s ERC-20 standard. BSC Hosts 450+ projects across DeFi, NFTs, gaming, and infrastructure. It has active developer forums and GitHub repositories, which make onboarding easier. The BSC Grants Program uses Quadratic Funding via HackerLink.io. It has distributed over $780,000 to 108 global project developers in one round alone.
On the other hand, Binance Chain focuses on asset issuance and trading via BEP-2 and BEP-8 standards. It lacks smart contract support, so no compatibility with Ethereum developer tools. The developer activity is concentrated around Binance DEX and wallet integrations. Binance Chain has a smaller developer community with fewer open-source projects. They also get minimal grants or incentive programs compared to BSC.
Network Speed and Transaction Costs
Binance Chain has instant finality thanks to Tendermint-based BFT. Once a block is committed, it’s irreversible. It has an estimated 1,000+ TPS for fast asset transfers and trading. Binance Chain has extremely low gas fees, typically ranging from fractions of a cent to a few cents. It is ideal for high-frequency trading on Binance DEX, where speed and finality are critical.
On the other hand, Binance Smart Chain is a bit slower, with blocks confirmed every ~3 seconds. Finality is probabilistic but reliable after a few confirmations. It has around 100–300 TPS, depending on network load and validator performance. Gas Fees are very low on BSC, typically ranging from $0.01 to $0.10 per transaction. BSC is suitable for DeFi protocols and NFT minting, where responsiveness matters but smart contract execution is key.
Wallet and Tooling Support
Binance Smart Chain offers full support for MetaMask Wallet. It allows easy interaction with BSC-based dApps and smart contracts. In comparison, Binance Chain offers no support for MetaMask Wallet.
Both chains support Trust Wallet and Binance Chain Wallet. These wallets enable easy token management and cross-chain transfers between BSC and BC.
BSC is compatible with Ethereum-based SDKs, such as web3.js, ether.js, Hardhat, Remix, and truffle. In comparison, BC has its custom SDKs for DEX integration.
BSC uses the BscScan explorer tool for transactions and contracts. BC uses Binance Chain Explorer for asset transfers and DEX trades.
Token Transfers and Interoperability
Binance Chain uses BEP-2 tokens that usually start with bnb, whereas Binance Smart Chain uses BEP-20 tokens that start with 0x. These tokens can be moved between chains by using the Binance Bridge or the Binance Wallet’s cross-chain transfer feature.
Binance Bridge uses token wrapping, where the original token is locked on the chain and a wrapped version is minted on the other. Binance Wallet allows seamless transfer between chains without the need for a centralized exchange.
Unlike the BEP-20 token, the BEP-2 token transfer requires a memo, and failing to include it can result in lost funds. Each chain has its own fees, with BEP-20 usually charging gas fees similar to Ethereum. Another user limitation involves the type of wallet being used, as Metamask only allows BEP-20 tokens.
Governance
In the Binanace Chain, the governance mechanism uses Delegated Proof of Stake (DPoS), and validators are selected based on delegation and performance. It has limited programmability, and governance mostly revolves around trading pair proposals and token management. Binance Chain also has less community involvement in protocol-level decisions.
In the Binance Smart Chain, the consensus mechanism used is Proof of Staked Authority (PoSA). It has 21 active validators who are elected by BNB stakers. BSC supports on-chain governance mechanisms, and the community can vote on proposals using platforms like Snapshot and Tally.
Which Blockchain is Suitable for Which Scenario?
While both Binance Chain and Binance Smart Chain have their own benefits and drawbacks, selecting the best one from within the BNB system depends on your needs and goals.
Binance Chain
If you are looking for token trading or DEX operations, the best option is Binance Chain. It is optimized for performance and speed, and is lightweight and efficient. BC is ideal for users who don’t need smart contract functionality.
Binance Chain can be used for launching BEP-2 tokens, running a DEX like Binance DEX, or performing high-speed trading with minimal latency.
Binance Smart Chain
Binanace Smart Chain is best for programmable applications and decentralized finance. It supports Ethereum tools and dApps with a large developer community and ecosystem. BSC has low fees and fast block times.
BSC can be used for deploying EVM-compatible smart contracts, creating and trading NFTs (BEP-721, BEP-1155), and building DeFi protocols like lending, staking, and yield farming.
BNB Chain
However, if you want to use ecosystem-level tools or cross-chain deployment, you can use the best of both worlds, the BNB chain. It is best for projects that span multiple chains or require advanced infrastructure.
It provides unified branding and interoperability with ecosystem-wide tools and services. BNB Chain features a future-proof architecture that ensures scalability and decentralization.
You can use BNB Chain for Cross-chain dApps via the BNB Beacon Chain and the BNB Smart Chain. It has decentralized storage via BNB Greenfield and provides governance, staking, and validator operations.
The Role of BNB Token in Both Chains
The BNB token is the lifeblood of the BNB ecosystem, powering both the Binance Chain and the Binance Smart Chain. On the Binance Chain, the BNB token adheres to the BEP-2 token standard, and its address typically begins with “bnb….” It is used to pay transaction fees and often requires a memo field.
On the BSC, the BNB token follows the BEP-20 token standard, which is EVM-compatible. Its wallet addresses start with “0x….” and require no memo for gas transactions to execute smart contracts or dApps.
BNB token can be staked on the BNB Smart Chain to support validators under the Proof of Staked Authority (PoSA) model. Stakers then earn rewards and help elect the 21 active validators who produce blocks and secure the chain. However, staking is not available on Binance Chain as it only focuses on speed and trading rather than smart contract execution.
BNB tokens can be purchased and burned through a BNB burn program by using a portion of transaction fees and other revenues. This reduces the total supply of BNB tokens, increasing their scarcity and value. While both chains contribute to this burn mechanism, most activity comes from BSC due to its high volume of smart contract interactions.
BNB token holders can participate in governance via platforms like Snapshot and Tally. These roles include voting on protocol upgrades, changing fee structures, and deciding validator policies. Governance is primarily active on BNB Smart Chain but not on Binance Chain itself.
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FAQs (Frequently Asked Questions)
Q: What is the BNB Chain, and how does it relate to BSC?
A: The BNB Chain is the unified blockchain ecosystem created by Binance. It is the ecosystem name that encompasses BNB Beacon Chain and BNB Smart Chain (BSC). BSC is a core part of BNB Chain.
Q: Can I use MetaMask with both Binance chains?
A: No. MetaMask is only available for Binance Smart Chain and is not compatible with Binance Chain.
Q: Are BEP-20 and BNB Smart Chain the same?
A: BEP-20 is a token standard for BSC, while BSC is a blockchain network that hosts smart contracts and dApps.
Q: Which is better for developers: Binance Chain or BSC?
A: BSC as it offers smart contracts, lower fees, high throughput, vibrant ecosystem, and cross-chain interoperability.
Q: Can I transfer assets between Binance Chain and BSC?
A: Yes, by using either Binance Bridge or Binance/Trust Wallet. However, you can’t use MetaMask Wallet s it doesn’t support Binance Chain or BEP-2 token standard.
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