What Are Binance-Peg Tokens?
Binance has created Binance-Peg tokens for the BNB Chain. These tokens are a type of wrapped token where Binance acts as the custodian, making stablecoins and other cryptocurrencies available on BNB Smart Chain.
The crypto world grows day by day and with that growth comes multichain. This means that people want to move across multiple blockchains and use their cryptocurrency beyond their original blockchain networks. For the BNB Chain Binance has made a solution. They have created Binance-Peg tokens. These tokens are a type of wrapped token where Binance acts as the custodian, making assets available on Binance’s own BNB Chain.
So What Are These Binance-Peg Coins?
Binance-Peg tokens are digital representations of cryptocurrencies issued on the BNB Chain. Each Binance-Peg token is backed 1:1 by the corresponding native asset, with Binance holding the reserves. So essentialy just a wrapped token, but with another name and only Binance as the custodian.
Find more information on wrapped tokens vs native coins here: https://blog.depouch.com/native-coins-vs-wrapped-tokens/
Examples of Binance-Peg tokens:
- USDC on BNB aka Binance-Peg USDC on BNB Chain
- USDT on BNB aka Binance-Peg USDT on BNB Chain
- ETH on BNB aka Binance-Peg Ethereum on BNB Chain
- BTC on BNB aka Binance-Peg Bitcoin (BTCB) on BNB Chain
These wrapped tokens allow users to interact with USDT, USDC, BTC and other assets in the BNB Chain ecosystem without leaving the Binance Smart Chain.
How Do Binance-Peg Tokens Work?
The operational flow for Binance-Peg tokens is managed by Binance and differs from permissionless on‑chain wrapping mechanisms. Here is how it most likely works:
- Reserves are held by Binance: Binance maintains custody of the native assets that back the pegged tokens. These reserves are held in wallets and custody arrangements controlled by Binance.
- Issuance is centrally managed: Binance issues/mints Binance-Peg tokens on BNB Chain to reflect the backed amount. Issuance/minting is performed by Binance’s systems.
- On‑chain use: Once issued/minted, Binance-Peg tokens circulate on BNB Chain and are available for transactions, trading, liquidity pools, and other DeFi activities.
When you swap a Binance-Peg token on depouch you do not have to think about the above. For you it's like swapping or trading any other coin.
Native Coins vs Binance‑Peg Tokens
| Aspect | Native Coins | Binance‑Peg Tokens |
|---|---|---|
| Existence | On the asset’s original blockchain | On BNB Chain (BEP‑20 tokens) |
| Custody | Controlled by private key holders | Backing assset held in custody by Binance |
| Backing | Secured by native chain consensus | Backed by reserves managed by Binance |
| Usage | Native‑chain transactions, payments, protocol security | Transaction, DeFi, trading on BNB Chain |
So That Means
Binance‑Peg tokens let users access assets like USD‑pegged stablecoins and Bitcoin within the BNB Chain ecosystem. They are centrally issued/minted and managed by Binance and are backed by reserves of the native assets.
So Binance-Peg Tokens are not the same as native assets. Instead they are representations designed for convenience and composability in the BNB Chain environment.
On depouch DEX you can swap Binance-Peg tokens like BTCB, ETH, USDT and USDC to native coins/tokens and vice verse.
Thanks for reading this blog on Binance-Peg Tokens Coins. We wish you a happy swapping!
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