DeFi thrives on Binance Smart Chain as users flee exorbitant ETH fees

The prices and market capitalization of tokens in the Binance Smart Chain (BSC) ecosystem are booming as the whole sector is up 135% over the past week, according to CryptoSlate’s data.

The top 10 Binance Smart Chain tokens. Image: CryptoSlate
The top 10 Binance Smart Chain tokens. Image: CryptoSlate

Binance Coin (BNB) is leading the charge. Just yesterday, the coin broke a new all-time high of $100 and is already trading at around $130 today—up 20% over the last 24 hours and 150% over the week.

The latest rally has pushed BNB’s market cap to nearly $20 billion, with a daily trading volume of $7 billion.

BNB price chart
BNB price chart. Image: TradingView

BSC-based decentralized exchange (DEX) PancakeSwap’s token CAKE follows closely with +21.75% on the day and +227% on the week. Although its market cap is much smaller—$750 million—it’s clearly getting a lot of traction lately.

XVS, the native token of money market decentralized finance (DeFi) platform Venus, also gained 277% over the past seven days, reaching a market cap of $341 million.

Other BSC tokens such as Unifi Protocol DAO (UNFI), CertiK (CTK), Spartan Protocol (SPARTA), and many others similarly surged by 100%-280% over the past week.

Ethereum fees drive users away

One of the main reasons for BSC’s meteoric rise is likely the constant growth of transaction fees on competing Ethereum. While DeFi has been growing exponentially since last summer, so did the cost of asset transfer.

According to crypto metrics platform Blockchair, the average transaction fee on Ethererum has shot up above $24 recently, making the blockchain quite expensive to use for “normal” crypto enthusiasts.

Ethereum transaction fees
Ethereum transaction fees. Image: Blockchair

Coinciding with the surge of its ecosystem, BSC also outpaced Ethereum in terms of daily transactions today, Binance CEO Changpeng Zhao noted.

“Today is an important day. #BSC (#BinanceSmartChain) flipped Ethereum on daily transactions,” Zhao tweeted, adding, “This validates the logic that low fees attracts (sic) more users & projects. We will continue to work with the #BSC community to promote low fees (even as #BNB rises) and #build more.”

Judging by the BSC ecosystem’s growth recently, it really looks like this approach is working.

Explore the Binance Smart Chain ecosystem on CryptoSlate.

The post DeFi thrives on Binance Smart Chain as users flee exorbitant ETH fees appeared first on CryptoSlate.

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