In a surprise March 13th announcement, cryptocurrency exchange Binance announced the creation of Binance Chain, a native blockchain that will back a decentralized exchange within the Binance ecosystem. The company concludes a “tailored blockchain is the best way” forward.
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Binance: ‘Actions Speak Louder than Words’
That’s because the cryptocurrency exchange, which is currently #1 in trade volume over the past 24 hours, has now announced the creation of its own blockchain — Binance Chain — in a bid to create a decentralized exchange platform to complement its centralized services.
It’s all part of the company’s strategy to build an ecosystem for its brand. Per the announcement:
“Binance Chain will mainly focus on the transfer and trading of blockchain assets, as well as provide new possibilities for the future flow of blockchain assets. Binance Chain will focus on performance, ease-of-use, and liquidity. Binance Coin (BNB) will be upgraded to exist on its own blockchain mainnet, becoming a native coin. At the same time, Binance will transition from being a company to a community.
We know how hard it is to create a business, however, creating history is even harder. The real enemy is often ourselves. We need to continuously improve and disrupt ourselves. We need to work together to create a better version of ourselves.”
Binance CEO Changpeng Zhao quickly chimed in on Twitter, too, stressing that starting “one more Binance” seemed like the optimal way forward for the exchange:
Binance was growing too quickly, and too busy to start anything else. So, all we could do is, to just start one more Binance. https://t.co/r5RjPNyrDq
— CZ (not giving crypto away) (@cz_binance) March 13, 2018
The Marriage of Centralized and Decentralized Exchanges?
It will be interesting to watch in the weeks ahead how other top exchanges in the space maneuver in response to Binance’s decentralized exchange, or DEX, play.
It’s not hard to imagine an arms race ensuing as other centralized exchanges follow Binance’s lead in wedding a DEX with centralized services.
If the model takes off, it may indeed become ubiquitous in the cryptoverse among the larger and more popular exchanges. Yet, of course, there are purist detractors who would say strictly decentralized options are best. Regardless, the hybridization of the the centralized and the decentralized is certainly a dynamic to watch, and all eyes are on Binance now accordingly.
What’s your take? Do you think Binance Chain is a good idea? Sound off in the comments below.
Images via Financial Times, Medium