The number of transactions on the Binance Smart Chain (BSC) was five times higher than that of the Ethereum network, due to the growth of activity on the PancakeSwap decentralized cryptocurrency exchange.
According to EherScan, on April 21, Ethereum’s blockchain processed 1.56 million transactions, while BSC recorded a total of 9.13 million transactions. Only DEX PancakeSwap on BSC processed more transactions per day than the entire Ethereum network. PancakeSwap provided more than 2 million transactions in the BSC network per day, or about 20% of the total.
“New entrants to retail seem to go straight to BSC / PancakeSwap via TrustWallet due to low fees.” wrote On Wednesday, Avi Sanyal, head of trading at BlockTower Capital, tweeted.
BSC surpassed Ethereum in daily transaction volume and unique active wallets in Q1, according to a report by CoinDesk Research. This is due to the continuing rise in Ethereum fees, which prompts traders to look for alternative trading options on the BSC, Tron blockchains and other competing networks.
Ethereum blockchain gas price versus Binance Smart Chain. Source: cryptohouse
Ethereum has become a victim of its own success, as record activity not only attracted developers and users, but also led to network congestion and increased fees. In the first quarter, transactions worth $ 1.5 trillion were processed on the Ethereum blockchain. According to the data provided by Messari, this is more than the cumulative result for the previous VII quarters.
The average transaction fee on the Ethereum network skyrocketed to $ 38 at the end of February and stood at $ 28 as of April 22, which is still significantly higher compared to the $ 2 to $ 4 range at the end of 2020. This has opened up opportunities for Ethereum’s competitors in the blockchain smart contract arena.
“With commissions 100 times less than other DeFi-enabled blockchains, BSC has grown to 1 million daily active users,” writes Binance’s press office.
Binance Smart Chain transaction volume. Source: BSC scan
The difference between Binance Smart Chart and Ethereum is now more visible than ever, with daily transactions on BSC nearly tripling over the past seven days. For Ethereum, this indicator grew by only 12%, as the network bandwidth is already at the limit.
The PancakeSwap Decentralized Exchange has benefited from BSC’s low fees and posted solid gains this month, with total collateral value on the exchange rising from $ 5.89 billion to $ 10.76 billion. The DEX’s daily transactions are up 300% over the past week.
Meanwhile, on Uniswap, Ethereum’s decentralized exchange, the same figure has only risen 30% in the past seven days. As of April 21, Uniswap has processed 165,710 transactions – far less than Pancake.
“PancakeSwap’s daily volumes now regularly exceed Uniswap’s. This suggests that cheap transactions and scaling matter, ”said Denis Vinokurov, head of research at Trade the Chain. “The problem is not capital, there is a lot of it.”
Ethereum is often criticized for its lack of bandwidth and high transaction fees. However, according to the Weiss Ratings researchers, alternative tier 1 blockchains have only to dream of the popularity of the second cryptocurrency.
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