1inch, a decentralized finance (DeFi) protocol for routing trades, is now live on Binance Smart Chain (BSC) – hedging its bets on Ethereum’s ability to handle more transaction volume.
Launched in 2019, 1inch routes trading orders for Ethereum-based tokens (and now BSC tokens) through dozens of integrated decentralized exchanges (DEXs) to get the best prices. It’s one of the largest DEX aggregators by trading volumes with some $450 million traded in the past 24 hours, according to Dune Analytics.
“The 1INCH token on Binance Smart Chain will be used for a bridge between the Binance and Ethereum networks,” a blog post shared with CoinDesk reads. “1inch users will get access to PancakeSwap, BurgerSwap, StreetSwap, Venus, StableSwap, JulSwap, BakerySwap and other Binance-based DEXes and lending protocols.”
Bukov said Binance did not pay for the integration, but did participate in the startup’s seed round in August.
1inch was forced to move onto BSC, 1inch CTO Anton Bukov told CoinDesk in a Telegram message, “because Ethereum miners killed the Ethereum network by not raising the block gas limit.”
Stepping back, each block on Ehtereum has an upper bound on how much gas can be used. That number has moved up a few times since the blockchain’s inception in 2015 depending on a few factors such as the uncle block rate, state size growth and transaction fee pressure. Historically high fees have garnered support for increasing the gas rate from application developers. It’s unlikely to happen, however, as a large increase in the Ethereum state size would further the risk of a denial of service (DoS) attack.
Many applications are looking elsewhere as the gas cap is unlikely to move. Some apps, such as Synthetix and dYdX, have chosen Ethereum-based rollups – a technology that bundles and processes transactions on Ethereum. Others are looking for alternative Layer 1 homes such as Compound Finance’s Compound Chain.
“BSC just has 10 times more gas every minute,” he added. “We are exploring what is really interesting for DeFi users.”
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 offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.