Binance launches Layer 2 blockchain on Optimism

The BNB chain's new layer 2 solution should be able to handle 4,000 transactions per second. Binance wants to use it to scale blockchain.

After a seemingly endless barrage of negative headlines, Binance may come up with a positive technological advance for a change. According to a official announcement the company is launching the layer 2 blockchain on BNB. This is intended to scale the BNB chain and provide a "seamless and efficient" experience for users and developers. The opBNB testnet has already launched on June 19. The start of the mainnet has not yet been determined.

What is opBNB?

Like the BNB Chain, Binance's Layer 1 blockchain, opBNB is compatible with the Ethereum Virtual Machine (EVM). Thanks to EVM compatibility, opBNB's blockchain infrastructure is similar to the Ethereum Chain in many ways. This allows developers to code in the popular Solidity programming language and users to use Ethereum-based wallets such as Metamask.

The new scaling solution is also built on Optimism's OP stack. This acts as a blueprint for crypto programmers to quickly and easily bring a Layer 2 blockchain to life. With this, Binance is following in the footsteps of competitor Coinbase, which already announced its Layer 2 solution "Base" using Optimism's technology in February of this year. With this integration, opBNB also benefits from Optimistic's rollup technology, including fast transaction speeds and low costs.

With a little fine-tuning, Binance hopes to get some more out of the underlying technology. According to its own informatie the opBNB manages about 4,000 transactions per second and an average transaction cost of US$0.005. In terms of performance and efficiency, the network thus joins existing blockchains such as Arbitrum, Optimism or Solana.

Not all that shines is gold

Even though it seems so through its own website, but Binance is not reinventing the wheel with opBNB. As with the BNB chain, which many initially dismissed as a cheap and centralized copy of Ethereum, the latest product is not a technological novelty. But the company knows how to recognize and serve crypto trends. And the trend right now is strongly toward modular rollups, as Optimism's Bedrock update shows. Demand for them is correspondingly high, especially among developers.

So the new Layer 2 scaling is likely to have particular benefits for developers and users of the Binance ecosystem. For example, the BNB chain will be extended through a layer on which gaming dApps and social networks have a place. But also existing DeFi-apps and DEXes on the BNB chain would find a new home. This would be the third-largest blockchain after Total-Value-Locked could reinvigorate and provide an edge over emerging competitors such as Base.

Outside the NBB ecosystem, however, the new Layer 2 solution seems less useful. Ethereum already offers fast mainchain alternatives with Arbitrum and Optimism, which often suffer from congestion and high costs at peak times. Therefore, the classic "faster than Ethereum" argument is no longer as compelling as it once was. How the new chain performs outside the test network remains to be seen. In any case, opBNB, along with the latest Lightning network integration, shows that Binance is still busy building.