Crypto exchange Binance's own blockchain platform Binance Chain is set to add smart contracts according to a new white paper. In the release, the company proposed a blockchain that will run in parallel to the chain, with smart contract functionality.
Smart contracts allow more complicated transactions to take place on a blockchain. They can be used to run decentralized applications (dapps). Ethereum was the first blockchain platform to fully support smart contracts.
Binance Chain is a distributed, but not very decentralized blockchain largely run by Binance. It has a high-throughput or highly performant matching engine as Binance calls it, which enables it to support a large number of transactions. However, it doesn't currently have the flexibility to support more complicated applications.
"Today, the Binance Chain development team proposed the idea of a parallel blockchain of the current Binance Chain to retain the high performance of the native DEX blockchain and to support a friendly Smart Contract function at the same time,” said the Binance Chain Development Community (BCDC), in a press release.
The Binance Smart Chain will be run by 21 validators, similar to EOS and Tron, with a proof of staked authority (PoSA) consensus mechanism. This will support a short block time and low fees. BNB will be its native token.
It will also be compatible with the Ethereum virtual machine, making it easier for dapps to be used across both platforms. But will they want to switch?