What is BEP2?
BEP2 is a technical standard for the issuance and implementation of tokens on the Binance Chain. It defines the rules for the tokens within the ecosystem and can be compared to the Ethereum’s own token standard, ERC20.
Binance Chain and BEP2
Technical specifications of BEP2 ensure that Binance Chain ecosystem tokens can seamlessly interact with each other. It also defines the features of the tokens issued on the Binance chain and their set of rules, determining their specific use cases.
What is BEP20?
BEP20 is a token standard used on the BNB Chain that extends ERC20, one of the most commonly used token standards in the DeFi space. It is also very similar to the BEP2, which is why BEP20 is compatible with both Ethereum and Binance Chain.
BNB Chain and BEP20
BNB Chain was envisioned as an extension to Binance Chain. Due to their underlying architecture, both of the chains are complementary, with BNB Chain, primarily focusing on decentralized applications and preventing the congestion of the Binance Chain.
What is BEP2?
BEP2 is a technical standard for the issuance and implementation of tokens on the Binance Chain. It defines the rules for the tokens within the ecosystem and can be compared to the Ethereum’s own token standard, ERC20.
BEP2 vs. BEP20
In the next section, we would like to explore the BEP2 and BEP20 token standards and identify some of the key differences between the two of them.We will go over the consensus mechanisms and highlight the importance of the BNB Chain to the entire Binance ecosystem.
Consensus mechasim and token standard
BEP2 and BEP20 are the native token standards of the Binance Chain and BNB Chain, respectively. In this section, we will go over their defining characteristics and find out how they distinguish from one another.
One of the main differences between these blockchains is their consensus mechanisms models. Binance Chain operates on the Tendermint BFT consensus and has a size limit of 1 megabyte. Its transactions burn BNB, Binance ecosystem native token. Binance Chain also enables the issuance of the BEP2 tokens.
BNB Chain, being an extension of the Binance Chain, has more opportunities for cross-chain compatibility. Unlike the Binance Chain, it operates under the Proof-of-Staked Authority, offering shorter block times and faster finality. Tokens that are issued there have a different token standard, BEP20.
Availability of smart contracts
Another distinguishing feature of the BNB Chain is its support of smart contracts. BNB Chain is designed to support EVM-compatible smart contracts and protocols, which enables a wide variety of decentralized applications to operate on their chain. Contrary to the BNB Chain, Binance Chain is a separate blockchain that is responsible for governing the BNB Chain.
Token addresses
Both chains can be easily distinguished by their respective addresses. Similar to the Ethereum blockchain, BNB Chain addresses begin with “0x”, while the Binance Chain has a unique prefix BNB and the transactions require MEMO.
Gas fees
In addition, due to its consensus model, BNB Chain is comparably cheaper than its counterpart. The native token BNB is used to pay for gas fees while also serving as a staking tool. BNB Chain also offers more opportunities for interoperability, supporting dual chain communications and enabling decentralized apps to operate in the BNB Chain environment.
Stablecoin transfers with Allbridge Core
Now that we covered the differences, we would like to address how Allbridge Core enables cross-chain interoperability for those users who seek to freely move their assets across different chains. Allbridge Core supports BNB Chain’s native stablecoin BUSD, offering cross-chain transfers of stablecoin liquidity between Ethereum, BNB Chain, Tron, and Solana.
As a messaging agnostic protocol, Allbridge supports Wormhole and custom Allbridge messaging, enabling the cross-chain swaps between Tron and other non-EVM chains. This makes it possible to convert Tron’s native USDT into the USDT on Ethereum and establish more opportunities for cross-chain interoperability. At the same time, the availability of multiple messaging protocols adds an extra layer of decentralization.
Convenient user experience
Moreover, due to the innate liquidity rebalancing functionality, every time native tokens are exchanged for virtual ones, the price of the native tokens decreases. This incentivizes users to swap the bridged assets back to the original chains, thereby rebalancing the liquidity pools.
To perform a cross-chain swap, one has to indicate the desired networks and tokens in the bridge interface. Once the transaction is initiated, the assets are exchanged on the source chain network to the virtual value transfer tokens. These tokens transfer the information via the selected messaging protocol.
When the message arrives, it triggers the contract on the destination blockchain. Then the virtual tokens are swapped into the desired asset, and native stablecoin assets are credited to the user's wallet. By streamlining all of the bridging steps into a single transaction, Allbridge Core seamlessly transfers assets between BNB Chain and other support networks in a non-custodial and private way.
Find out how Allbridge Core works under the hood in the corresponding GitBook section.
Conclusion
BNB Chain enables cross-chain compatibility and caters to decentralized applications without congesting Binance Chain. With Allbridge Core, you can seamlessly swap your stablecoin assets to and from BNB Chain. Our platform offers a simple and intuitive interface to facilitate cross-chain stablecoin transfers in one click, which makes it very user-friendly.
Future updates to the bridge functionality will include the option to convert some part of the transferred amount into a gas token, thus further reducing the barriers to entry into the new chain.
We invite you to check the bridge functionality and try swapping between BNB Chain and other supported networks via our platform.
