Binance Exchange’s native token Binance Coin (BNB) recorded another ATH yesterday of $412.26 after spending most of March in consolidation. BNB’s rise this bull season has nothing sort of phenomenal rising from under $50 towards the end of February to a new ATH above $400.
The phenomenal rise of BNB was mainly aided by the rising popularity of Binance’s native chain called Binance Smart Chain (BSC). The high gas fee on the Ethereum network made it quite costly for traders and defi users to execute any trade as the transaction cost in many cases was higher than the transaction amount itself.
BSC being an ERC-20 replica turned out to be the perfect alternative and ETH traders as well as several Defi protocols either migrated to BSC or created cross-chain support. The popularity of BSC rose so much so that it was processing double the transaction volume than the Ethereum network. Changpeng Zhao, the CEO of the Binance platform reminded everyone how BNB started out as a discount token for the Binance network and has grown to become the third-largest digital asset and similarly, BSC could also turn into a top defi blockchain network.
#BNB started as a fee discount token for @Binance CEX.#BNB is now a fee discount coin for #Ethereum, enter #BSC.
— CZ Binance (@cz_binance) April 7, 2021
While many ETH proponents have pointed towards the centralized nature of the BSC chain, most of the trading community only cares for the lesser transaction fee and ease of transactions. ETH 2.0 is said to eliminate most of the scalability and high gas fee issues faced by the current network, but it would take another two years for a complete roll-out. In the meantime, BSC has become the obvious choice for many.
Can BNB Overtake ETH to Become Second Largest Crypto Asset?
The phenomenal rise of BNB over the past couple of months has seen the token price rise by more than 8X since February end helping it rise to top-3 cryptocurrencies by market cap. With the BSC chain’s rising popularity and growing Defi market, BNB could surge further and many believe it has a good chance to overtake Ethereum as the second-largest cryptocurrency this bull season.
Ethereum market cap is currently at $231.6 Billion while the BNB market cap stands at $60 billion dollars. At the current rate, it would only take a 4X rise from here for BNB to flip ETH. The chances of BNB taking over ETH might look slim at this point given ETH has also registered nearly 3X rise since the start of 2021.
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