Binance Smart Chain (BSC) is the #DeFi pillar of the Binance ecosystem, offering a low-cost, high-performance EVM-compatible blockchain. This article presents how it works, its strengths, and details its three main DeFi applications: PancakeSwap, Venus, and BakerySwap.
What is Binance Smart Chain?
#BNB Chain is based on #BSC , a decentralized community blockchain designed to support #Web3 dApps and powered by the BNB token1. Thanks to its dual-chain architecture, BSC natively connects to Binance Chain while providing compatibility with the Ethereum Virtual Machine (EVM) for smart contracts4.
Key Advantages of Binance Smart Chain
Reduced transaction fees: costs are significantly lower than those on Ethereum, often just a few cents2.
High processing speed: BSC confirms a block in about 3 seconds, allowing up to 100 transactions per second4.
Interoperability: bridges and protocols like Binance Bridge facilitate asset transfers between BSC and other networks such as Ethereum4.
Main DeFi Applications on BSC
Decentralized exchange (DEX) platform and AMM, PancakeSwap allows swapping BEP-20 tokens and providing liquidity in exchange for rewards in CAKE, its native token2.
Venus
Decentralized lending and borrowing protocol that allows the creation of synthetic assets and offers interest on deposited crypto assets. It combines money market and algorithmic stablecoins2.
#BakerySwap AMM coupled with a marketplace #NFT BakerySwap invites users to trade tokens, provide liquidity, and participate in thematic NFT drops2.
Use Cases and DeFi Strategies
• Optimized lending/borrowing: Venus allows securing positions by borrowing against collateral, a common strategy to generate liquidity without giving up one's #tokens2 .
