Binance to Launch A Decentralized Trading Network To Curb Hack Attacks
Binance is developing a decentralized public blockchain that is to be used to transfer and trade digital assets. Dubbed Binance Chain, the platform is to provide traders a decentralized exchange that can handle transactions through an automated process.
The new blockchain platform is based on an improved version of the emerging technology and will focus on performance, ease of use and liquidity while working side by side the current exchange. It is also expected to act as a launch pad for new coins and Initial Coin offerings.
The proposed decentralized exchange is currently under development. The company is yet to issue a timeline on when it will be ready for use. Once complete the company plans to shift is Binance Coin to the native blockchain platform.
It is still unclear whether there will be some kind of swap of the token, once the transfer happens, given that BNB Coin is currently an ERC20 coin running on Ethereum network.
BNB Coin reacted positively to the announcement of a new decentralized exchange spiking up by more than 20%.
The launch of Binance Chain should enhance Binance competitive edge in the crypto exchange space that has until now been the domain of Coinbase and Bitfinex. The change is on track to become a crypto’s Google, as a turnkey solution for a wide range of cryptocurrency services. The launch of the decentralized exchange should also increase the networks user base that currently stands at over a million.
Centralized Vs. Decentralized Exchange
The launch of a new cryptocurrency exchange is part of Binance ongoing transition from a company to a community. It also comes at a time when cyber thieves are increasingly targeting cryptocurrency exchanges.
The fact that most exchanges are centralized has made them targets as cyber attackers find it easy to hack and walk away with assets stored in one location. Decentralization results in funds being stored in user’s wallets, which makes it impossible for hackers to hack a good number of accounts at a go.
“We believe significant improvements can be made in providing Binance users with a level of trading experience to which they are already accustomed. Centralized and Decentralized exchanges will co-exist in the near future, complementing each other, while also having interdependence,” Binance in a statement.
A decentralized exchange differs from a centralized exchange on the fact that it does not rely on third-party services for storing people’s funds. A decentralized exchange also provides more anonymity since there is no central server.
Hackers have already stolen $700 million worth of tokens since the start of the year, to the outcry of investors who have seen a good chunk of their fortunes go up in flames. Binance is one of the exchanges that has had to protect its network from hackers trying to gain access.
The exchange is currently offering a reward of $250,000 worth of BNB tokens to anyone who might have information that may lead to the arrest of attackers who tried to hack its system.