BNbitcoin: the reason why PoW mined cryptocurrency landed natively on the Binance Smart Chain
Three years have passed since the deployment of the 0xBitcoin smart contract on the Ethereum blockchain. 0xBitcoin [1] is the first PoW mined credibly neutral token on the Ethereum blockchain, and it was designed combining the best features from both the Ethereum and Bitcoin blockchains: it is protected against 51% attacks by the robustness of the whole Ethereum network, but it reproduces Bitcoin in preserving the fairness and transparency of tokens distribution thanks to the Proof-of-Work soliditySHA3 mining algorithm.
But in the crypto world, three years are like half a century in everyday life…
In these three years many interesting projects have arisen, scenarios are changing and recently even Big Companies have declared their interest or direct involvement in Bitcoin or, more in general, in cryptocurrencies [2].
Things in the crypto-universe are so fast-evolving that often it is not possible to predict what the next trend will be. This is limited not only to digital assets value predictions, but it can be extended also to the projects’ scope: several exist, but the most striking example is DeFi (Decentralized Finance)[3]. Even if DeFi’s beginning on Ethereum can be probably traced back to the implementation of the MakerDAO’s platform, it has “exploded” in 2020 with a heavy impact on the Ethereum ecosystem itself, with effects that we all see today on transaction costs.
At the time of writing, the disruptive success of the Decentralized Finance is placing huge pressure on the Ethereum network. As DeFi activity has risen, users have to pay miners higher and higher transaction fees. ETH holders are experiencing joyful moments because the token price is touching a three-years-high, but average users and developers are suffering from this condition. EIP-1559 [4] will be implemented on the Ethereum mainnet in July, 2021, and several improvements are planned with positive effects about transactions’ fee users experience, but probably such EIP won’t fix the high gas fees problem in short times [5]. Today Ethereum’s high gas fees make engaging with decentralized applications uneconomical for common users and for those who use the network on a regular basis with small amounts, leading several projects to be frozen (waiting for lower gas fees… ) and developers to search for alternative, DeFi-ready platforms having low or negligible transaction costs and high performance including, first and foremost, the Binance Smart Chain network [6].
Binance Smart Chain (called for sake of brevity “BSC”) is a Proof-of-Staked-Authority (PoSA) blockchain which enables the creation of smart contracts. Its native currency is BNB, it is EVM-compatible and it creates an ecosystem where validators, token holders, developers, and users all benefit from a rewarding blockchain that offers high performance and ample space for further innovations [7]. The reference fungible token standard for BSC is the “BEP20” standard, which is similar to ERC20 for the Ethereum network.
The DeFi implementation on the Binance Smart Chain has shown the enhanced network capabilities in supporting high transaction volumes (even higher than Ethereum) with a negligible impact on gas fees while maintaining quick transaction settlements [8].
Thanks to these features, the Binance Smart Chain has demonstrated to be the most suitable environment to implement a native re-genesis of the Bitcoin protocol as a mineable token: BNbitcoin (BNBTC).
The BNbitcoin smart contract comes from 0xBitcoin: it has been adapted to be compliant with the BEP20 BSC standard and it has been modified to face with the faster blocktimes of BSC than the Ethereum network. BNbitcoin has the same neutral distribution policy of Bitcoin: 21'000'000 BNBTC with 8 decimals that can only be mined (with no pre-mine nor ICO distribution). The target difficulty adjustment period is 2 weeks (2016 epochs), like Bitcoin, and the target blocktime is 10 minutes. The mining difficulty automatically adjusts to match the target period. The block reward halving policy also is the same designed by Satoshi Nakamoto: starting from a reward of 50 tokens per block, after the first 10.5 M mined tokens the reward becomes 25 tokens with the first halving, and so on.
Currently BNbitcoin allows solo-mining with both Nvidia and AMD GPUs, using the same mining software already available for the other mineable tokens on Ethereum. Naturally, being on the Binance Smart Chain, the minting gas fees are paid in small fractions of BNB. The following customization settings apply for BNBTC mining:
Token contract address (on BSC): 0xE7Cb24F449973D5B3520E5b93D88B405903c75Fb
BSC Network/chain ID = 56
Web3Api / RPC Url = https://bsc-dataseed.binance.org
BSC Explorer: https://bscscan.com/address/0xe7cb24f449973d5b3520e5b93d88b405903c75fb
The BNbitcoin whitepaper is available on the official GitHub repository, where a detailed description of the smart contract methods, including the mint() function — which is the core of the mineable tokens — is provided.
More details are available, also about mining configurations, on BNbitcoin website:
Regardless the development platform is, the scenario about mineable tokens is undoubtedly interesting: strongly secured by their underlying networks, their credibly neutral distribution based on Proof-of-Work mining allows a transparent minting, aligning them to commodities and not to securities.
You’ll hear more and more about BNBTC and the mineable tokens in the future…
References:
[2] https://decrypt.co/47061/public-companies-biggest-bitcoin-portfolios
[3] https://www.investopedia.com/decentralized-finance-defi-5113835
[4] https://eips.ethereum.org/EIPS/eip-1559
[5] https://coinmetrics.io/the-ethereum-gas-report/
[6] https://github.com/binance-chain/whitepaper/blob/master/WHITEPAPER.md
[7] https://www.binance.com/en/blog/421499824684900933/Binance-Smart-Chain-Launches-Today/
[8] https://cryptopotato.com/binance-smart-chain-daily-transactions-now-70-more-than-ethereums/
