Following a brief lull, Decentralised Finance (DeFi) is starting to heat up again. For investors that’s great news, although personally I’m far more interested in the technology side of things. (Doesn’t stop me investing on the side, of course!).
A relatively new DeFi project, BSC Station, is turning out to be pretty exciting — both for developers and for crypto investors.
As the name suggests, BSC Station runs on Binance Smart Chain (BSC). In the startup’s own words:
BSC Station aims to build a Full-Stack DEFI with NFT Auction on the Binance Smart Chain. It will become economy infrastructure for DeFi and NFT powered by BSC.
As blockchains go, BSC itself is about as centralised and custodial as you can get. So the combination of DeFi running on a centralised blockchain is an intriguing one. But it’s possible this particular combination provides the best of both worlds.
The truth is, decentralisation of the blockchain itself may not be that important to the majority of users. By “users”, I mean investors, people running smart contracts, etc. These people may find increased transaction speed and low costs to be far more compelling. Of course, that would quickly change if the company disappeared along with 100% of the nodes! But most organisations or individuals would, I suspect, be prepared to take that risk, or at least mitigate it, if they trust the custodial “big daddy” enough.
In fact, trusting a bag of money with one company isn’t all that different from putting the same bag of money into a centralised bank. (Arguably also a bad idea, of course).
So, the main benefit that a centralised blockchain brings is inherent scalability — block consensus is less of an issue, if the consensus is all done “in-house”. So BSC is naturally able to handle far more transactions per second (300) than, say, Ethereum (15, at the time of writing). Another benefit is much lower gas fees, a problem which is still hampering DeFi on Ethereum, even following their recent Berlin “hard fork”.
Meanwhile, the same users who prefer fast transaction times and lower fees over a decentralised blockchain might still highly value the benefits of a decentralised exchange. The lack of any one party being able to “call the shots” or unfairly manipulate the whole ecosystem will be of particular interest to NFT creators and collectors, not to mention smart contract developers in general.
So we can all agree that a DEX running on a fast, scalable, low-cost network is a very good thing…
However, the grandaddy of DEXs, Uniswap, is arguably hampered by its Ethereum underpinnings. Sure, that will almost certainly change when Ethereum 2.0 has gone fully live. But in the meantime, high fees — resulting from an ever-present backlog of transactions queued up on a slow network — are just kind of offputting for many people. How much more massive could Uniswap be already, if the underlying blockchain could keep up with demand?
This is exactly why BSC Station has such huge potential.
In fact, if you want to see exactly how much potential, you can already start swapping with BSCS and staking liquidity pairs, as their exchange launched very recently. For a train that’s “just about” to leave the station, I’d say that puts them some way out of Waterloo and already nearing Clapham Junction.
But BSCS is set to be much more than “just” a DEX. Going by their roadmap, it seems good times are ahead for BSC Station, and — at the risk of jumping onto a moving train — I’m excited to be on board.
Regardless, if you’re interested in using BSCS, you’ll probably want to create a Binance account [affiliate link], if only as a “fiat currency on-ramp” to buy some coins.
As one last comment for now, the BSCS team is currently hiring React, TypeScript and Solidity developers, in addition to UX/UI designers. These are all areas that LowCode app generator CodeBot from Parallel Agile (which I’m closely associated with) specialises in generating. Hmm, gets me thinking… ;)
(Also, obligatory note — none of the above is financial advice. I’m a software developer checking out cool DeFi projects…)