Binance has long been one of the world’s leading cryptocurrency exchanges. Have your own blockchain—— BNB smart chain – They also want to be the leader in the NFT industry.
BNB Smart Chain (BSC), formerly known as Binance Smart Chain, is a Layer-1 blockchain fully supported by the Binance cryptocurrency exchange. With the giant’s backing, BNB is expected to dominate the DeFi space, but has also branched out into NFTs, games, and even blockchain-based art.
Although BSC was extremely popular when it debuted, it faced increasing competition from other Layer-1 blockchains and a growing number of Layer-2 networks – but what makes BNB Smart Chain stand out, it is How did it become so popular, and why should it be on your radar?
Here is our complete guide to BNB Smart Chain.
Key insights
- Layer-1 blockchain, competing with Ethereum and Solana
- Created by the team behind Binance cryptocurrency exchange
- Debuted in 2020, replacing the original Binance Chain from 2019
- Explosive growth during 2021’s first NFT boom
- Known as a blockchain primarily centered around DeFi
What is BNB smart chain?
BNB Smart Chain is the first-layer blockchain launched by the popular cryptocurrency exchange Binance in September 2020.
It is designed as an upgrade to the original Binance Chain launched in 2019, adding support for smart contracts – allowing for decentralized applications (dApps), NFTs, and more.
BSC has full Ethereum Virtual Machine (EVM) compatibility, allowing it to work seamlessly with a variety of Ethereum-based dApps, tools and services.
BNB Smart Chain is powered by the $BNB token (which stands for “Build and Build”), which is used to pay transaction fees and promote the governance of the blockchain through staking and voting mechanisms. $BNB is one of the most popular cryptocurrencies in the world, regularly ranking among the top ten cryptocurrencies in the world. As of January 18, 2025, it is currently ranked 6th with a token price of over $700 and a market cap of over $100B.
In terms of services, BNB Smart Chain may be best known for its trading platform PancakeSwap, which provides both leading DeFi services as a decentralized exchange and an NFT market based on BSC. Some of the most popular NFT series on the BNB Smart Chain include Pancake Squad, Pancake Bunnies, and PixelSweeper.
Through Binance’s cooperation with world-renowned football star Cristiano Ronaldo, BNB Smart Chain has also launched multiple digital collectible series featuring the star. This helps raise BSC’s profile and introduces the chain to a whole new fan base.
How does BNB smart chain work?
BNB Smart Chain was built with speed, efficiency and affordability in mind, making it attractive to both developers and users.
Some of its prominent features include:
- Unique consensus mechanism. BSC uses a unique consensus algorithm called Proof of Stake (PoSA) – a hybrid of Proof of Stake and Proof of Authority. Validators stake BNB as a requirement to validate the network, earn BNB fees as rewards, and ensure security, speed, and low latency.
- Ethereum compatibility. BSC is EVM compatible. Developers can deploy Ethereum-based applications on BSC using familiar tools and languages, such as Solidity, with minimal adjustments. This allows BSC to quickly expand its ecosystem through a large number of dApps.
- Transaction fees are low. With transaction fees typically as low as a few cents, BSC provides an affordable alternative to Ethereum, where high gas fees have been a long-standing issue.
- Extensive dApp support. BSC supports a variety of dApps, from decentralized exchanges (DEX) and lending platforms, to yield farming protocols and NFT markets. Popular dApps such as PancakeSwap, Venus, and Autofarm still retain hundreds of thousands of users today.
In addition, BNB Smart Chain provides powerful infrastructure for NFT creators and collectors. It supports token standards such as BEP-721 and BEP-1155 (equivalent to Ethereum’s ERC-721 and ERC-1155), ensuring easy interoperability and direct interaction.
By providing a scalable and efficient blockchain, BSC enables developers to build innovative applications that can handle large numbers of users at a smooth and stable speed. This is critical for the growth of blockchain-based services – especially as more users enter the industry every day.
The history of BNB smart chain
The history of BNB Smart Chain is closely tied to the history of the Binance cryptocurrency exchange itself.
Two years after Binance was founded in 2017, the company launched the original Binance Chain. This first-of-its-kind blockchain is focused on improving transaction speeds on Binance itself and includes the adoption of the $BNB token as the native currency of Binance products.
Despite its many benefits, Binance Chain does not support smart contracts — a decision that limits its potential. To this end, Binance launched Binance Smart Chain in September 2020 – initially running alongside Binance Chain, with plans to replace or integrate the original chain in the future.
Binance Smart Chain has both smart contract support and EVM compatibility, supporting not only the growing DeFi market but also the increasingly popular NFT industry.
As NFTs boomed in 2021, Binance Smart Chain also saw explosive growth, sometimes even surpassing Ethereum. Its low fees and high-speed transactions attracted developers and users, and this period was a significant high point in the chain’s history.
In February 2022, Binance merged Binance Chain and Binance Smart Chain into what we know today as BNB Smart Chain (BSC), emphasizing the “build and build” ideology and fanatical nature of the community at the time.
As other Layer 1 and Layer 2 networks have come to the fore over the past few years, BSC has arguably fallen out of favor. Nonetheless, as the $BNB token remains an important pillar of the cryptocurrency industry, the BNB Smart Chain remains a highly regarded solution and continues to improve it in the future.
These improvements include further decentralizing the network, removing Binance Corporation from playing a major role in the day-to-day operations and management of the ecosystem. Scalability and interoperability upgrades are also underway, with the introduction of sidechains and exploration of sharding technology being considered to increase transaction speeds and help accommodate the growing number of dApps.
2025 will bring new challenges to the BNB smart chain, but it is also full of opportunities. As NFTs and cryptocurrencies continue to find new audiences, and as the broader industry continues to evolve, the future of the BNB Smart Chain will hold huge potential.
