Crypto Academy Week 9 - Homework Post for @alphafx|| Binance Smart Chain VS Ethereum Network – A Detailed Comparison
Big thanks to you, dear Prof. @alphafx, for your self-explanatory lecture this week. When it comes to block chain and different networks, I did not know much until I went through your lectures. Less I forget: congratulations on your appointment as the new professor.
After some research, I want to put up a comparison between the Binance smart chain (BSC) and Ethereum block chain. I hope to explore these two as much as possible. To make this piece easy to go through, I will arrange my work in the following order:
Introduction
What is Binance Smart Chain?
What is Ethereum Block chain?
Difference and Similarities between the Two
Conclusion
Introduction
The block chain technology is a decentralized universe, where the internet world thrives. Its ecosystem is governed by several protocols, which could be proof-of-work (example Bitcoin block chain) or proof-of-stake (example Cosmos).
The decentralized nature of the block chain technology makes it unique, in that every activity on the network can be accessed by all users. An example is tracking of a transaction on the Binance smart chain by use of the transaction harsh on bscscan.com.
The block chain technology offers a transparent, trustless and secured platform for internet activities for users, ranging from digital asset transactions, like in Ethereum and Binance smart chain, content creation in Tron network, building of decentralized applications (DAPPs), among others.
One of the great things about block chain is that the information is not controlled by a single server, thus an attack on one server can never jeopardize the potency of the network.
What is Binance Smart Chain?
The Binace smart chain (also known as Bep20) is Binance governed decentralized network. It was launched in April 2019. It is a network mainly focused on providing a fast, non-custodial (decentralized) trading to users globally. A lot of DAPPs has been built on the Binance smart chain, with Binance decentralized exchange (Binance DEX) being the most friendly. Other projects (DEX) built on this block chain are Pancakeswap, Julswap, OpenOcean, Cub finance, among others.
It is built to have compatibility with the Ethereum virtual machine (EVM), with lower transaction fees than the Ethereum block chain.
More details will be captured in the comparison (Differences and Similarities) between BSC and Ethereum block chain.
What is Ethereum Block chain?
The Ethereum network is a decentralized platform that offers a home for global payments, digital money and decentralized applications (DAPPs). It is open source, accommodating enough for new digital economy to thrive and possess all the features of decentralization.
It should be noted that Ethereum networks runs on Decentralized Finance (DeFi) ecosystem, thus it offers services like lending, borrowing and earning from the activities within the network.
Differences and Similarities between the Two
Differences
Ethereum network has its own virtual machine, while BSC has none, rather it is built to be compatible with the Ethereum virtual machine (EVM).
On Ethereum network, the transaction fees are very high and transaction speed is low, while in BSC transaction fees are relatively low and has higher speed of transactions.
BSC has attracted more users to its network over the years, while more people are leaving the Ethereum network for BSC, owing to the high cost of gas fee in Ethereum based transactions.
Ethereum network runs on proof-of-work (PoW) algorithm, while BSC runs on proof-of-stake (PoS) algorithm.
Similarities
Both networks are decentralized and offer DeFi benefits like lending, borrowing, creating of DAPPs. This makes it possible to bridge the gap between them, as tokens can be swap from Ethereum block chain to BSC and vies versa.
They both make use of smart contract in every activity on the block chains. That is to say that programs are written and fixed, thus execution is fixed and does not need third party for approval.
Ethereum block chain makes use of a single chain protocol called ERC-20, while BSC makes use of a dual chain technology, namely Bep2 and Bep20.
Conclusion
Different block chains are here to stay and with different use cases, one can can choose which block chain to use based on their needs. It is obvious, from the popularity gained by BSC in recent years, that people are drawn to more friendly projects, in terms of cost of usage, versatility in operation and speed.
No doubt that both Ethereum and BSC are doing well in terms of popularity, but more efforts should be employed by Ethereum in reducing their gas fees.
Did you enjoy this piece? Which of the two networks do you prefer?
Thank you for your time.
Scoring
Thanks for participating
Thank you.