Binance to Launch Decentralized Cryptocurrency Exchange

Binance to Launch Decentralized Cryptocurrency Exchange

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The Binance Exchange, which has demonstrated unprecedented growth since its launch in the middle of last year, decided to create a decentralized trading platform.

“After carefully studying the basics of decentralized exchanges and analyzing existing implementations, we came to the conclusion that this technology needs further development. In the near future, centralized and decentralized exchanges will coexist, complementing each other and demonstrating interdependence,” Binance writes.

Decentralized exchanges allow their users to transfer cryptocurrency assets without having to trust their third-party services, which often become victims of hacker attacks and can be managed by unreliable operators.

The two most well-known decentralized exchanges today are EtherDelta and IDEX. They use a smart contract system to transfer ERC20-tokens through the Ethereum blockchain system. The decentralized exchanges themselves can not be called fully protected, since they use centralized servers in their work that have already been compromised, but they are much less vulnerable.

Existing decentralized exchanges are often criticized for being more difficult to handle than centralized counterparts. Binance intends to develop a hybrid service that will combine the functionality of DEX with the simplicity of a conventional trading platform.

The exchange will operate on its own blockchain Binance Chain, to which will be transferred  Binance Coin, currently representing the ERC20-token.

In their message Binance does not give the characteristics of his new detachment and does not specify what mechanism of consensus will be used. In any case, this is an unprecedented step for the exchange, which, like its competitors, is criticized for being one of the largest centralized players in the decentralized cryptocurrency space.

Against the backdrop of this news, Binance Coin showed steady growth, rising from $ 8 to $ 11 within an hour.

CEO Binance Changpeng Zhao promised to provide additional information about the new project in the next few days.

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