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Binance Upgrades Blockchain Bridge to Connect DeFi and CeFi

The firm behind the exchange is continuing its infrastructure push.

By Eliza Gkritsi
AccessTimeIconMar 29, 2022 at 1:00 p.m. UTC
Updated May 11, 2023 at 4:07 p.m. UTC
Binance Logo (Maquette.pro/Shutterstock)
Binance Logo (Maquette.pro/Shutterstock)
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Binance, the world's largest cryptocurrency exchange by trading volume, has launched the second iteration of its cross-chain protocol that connects its flagship layer 1 blockchain, BNB Chain, with other chains.

  • Binance Bridge 2.0 will be compatible with more blockchains, feature a better user experience and decrease maintenance costs, the firm said in a press release shared with CoinDesk on Tuesday.
  • The bridge will allow users to access traditional centralized finance (CeFi) and decentralized finance (DeFi) via the Binance app. Decentralized finance refers to financial activities carried out on the blockchain without any intermediaries.
  • Binance rebranded its layer 1, or base, blockchain to BNB Chain in February as it pushed towards being a key blockchain infrastructure provider. The bridge is an important element of that push, as it allows users and developers to bring other tokens to Binance's ecosystem.
  • Through the bridge, users can bring unlisted tokens on BNB Smart Chain as B-Tokens, the press release said. B-Tokens are tokens pegged to the value of some underlying cryptocurrency. This technology, known as wrapping, is used to move tokens from one blockchain protocol to another by essentially mirroring them.
  • Tokens that are listed on Binance's crypto exchange will be stored in Funding or Spot Wallets, whereas unlisted tokens will be saved on Funding Wallets. BNB Smart Chain is a blockchain that is compatible with the Ethereum Virtual Machine (EVM), where smart contracts are executed. Funding wallets facilitate peer-to-peer transactions.
  • The bridge comes with a new automated circulation control system for B-Tokens, which will only keep a buffer surplus of the wrapped tokens in hot wallets and mint new ones when users bring tokens from different blockchains on BNB Smart Chain. The rest of the circulating supply of tokens will be backed by the native tokens bridged to Binance's ecosystem.
  • Separately, BNB said that scaling platforms Celer, Ankr, and NodeReal launched the first BSC Application Sidechain (BAS) testnet.
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    • Read more: Binance Smart Chain Rebrands to BNB Chain

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    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Eliza Gkritsi
    Eliza Gkritsi

    Eliza Gkritsi is a CoinDesk contributor focused on the intersection of crypto and AI.

    Follow @egreechee on Twitter

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