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BNB Research
Quick Intro
BNB was initially launched as an ERC-20 token on Ethereum in 2017.
Binance Chain was introduced in 2019 to provide a decentralized and fast trading capability for blockchain users, merely a transactional blockchain.
In 2020, Binance Smart Chain is created to support smart contracts. Instead of upgrading the Binance Chain, Binance decided to keep both running in parallel to maintain Binance Chain’s transaction capacity intact.
It was later migrated to Binance’s native chain, Binance Chain.
In 2022 Binance Chain is rebranded to BNB Chain, which was a merge of Binance Chain (rebranded to BNB Beacon Chain) and Binance Smart Chain (rebranded to BNB Smart Chain). The “new” BNB Chain is comprised of:
BNB Beacon Chain - what was previously Binance Chain, mainly used for governance and staking.
BNB Smart Chain (BSC) - previously known as Binance Smart Chain, it hosts the blockchain ecosystem, supports deployment of smart contracts and dApps.
How it BNB Chain Works
Consensus Mechanism
BNB Smart Chain was introduced as a solution to bring programmability and interoperability to the BNB Beacon Chain. They both run parallel to each other and are both essential for the BNB chain. It could be seen as a dual chain architecture.
BNB Smart Chain uses a Proof of Staked Authority (PoSA) and relies on 56 validators. The PoSA consensus is a combination of Delegated Proof of Stake (DPoS) and Proof of Authority (PoA).
DPoS allows token holders to vote and elect validator sets, it increases decentralization.
PoA is criticized for not being as decentralized as PoW, but provides security against 51% attacks, improved efficiency and Byzantine fault tolerance.
Once combined, DPoS and PoA achieve:
Producing blocks only by a limited number of validators.
Validators take turns in producing blocks thanks to PoA.
Validators are elected in and out based on staking governance.
PoSA introduces decentralization and community involvement by allowing token holders to stake and delegate tokens to validators or validator candidates.
The network underwent 2 hard forks in August of 2023: Plato and Hertz.
Plato introduced BEP-126 to enhance security and efficiency by improving the finality mechanism.
Hertz focused on improving compatibility with EVM networks.
Validators
BNB Smart Chain relies on 56 validators with PoSA consensus to commit new blocks by signing the blocks that contain cryptographic signatures signed by each validator’s private key.
40 active validators
21 cabinets - the top 21 stake validators which will produce blocks.
19 candidates
16 inactive validators which act as backups.
Validators are selected every 24 hours and anyone can become a validator.
Validators can self-delegate (self-bound) BNB to themselves and can receive delegations from BNB holders.
The minimum required delegation is 2,000 BNB.
Only the 40 highest-stake nodes are chosen to be part of the validator set.
Rewards
Rewards are distributed by weights at the end of every epoch.
They come from transaction fees and commission fees from delegators.
Slashing
Running validators with the same consensus and voting keys concurrently on 2+ machines results in malicious vote slashing. 10,000 staked BNB is slashed.
If a validator misses more than 50 blocks every 24 hours, the rewards are not shared with it. If it misses 150+ blocks every 24h, 50 BNB will be slashed and obligated downtime of 2 days.
Validators must stake at least 2,000 BNB as self-delegation, if they miss this, they get Jail time of 1 day.
Mempool
In the BNB consensus occurs in rounds, during which validators agree which transactions to accept. Each round starts with a proposer creating a block with the most recent transactions and validators (nodes with voting power) agree to accept the block or go with a null block instead
For reference, Ethereum’s mempool acts as a dynamic storage space to validate transactions and prevent double spending. When initiating a transaction, it is first propagated to nodes to be validated checking factors like signature authenticity and nonce value. Once it is validated, the transaction enters the mempool where it waits to be included in a block by nodes. Nodes decide which transactions to include based on factors like gas and fee sorting.
Sequencers
opBNB is the first-ever Layer 2 scaling solution for the BNB Smart Chain powered by bedrock version of Optimism OP Stack. As it is based on the OP stack, it uses optimistic rollup technology to increase throughput and low fees for users.
opBNB’s TPS are estimated to be around 4.7k transactions per second which can empower high DAU dApps in the network.
It involves:
Sequencers: process and order transactions off-chain before sending them to the BSC for finality.
Provers: generate cryptographic proofs to prove the validity of the network’s state transitions.
Verifiers: check the proofs to verify the state is correct.
With opBNB another feature for simple Web3 experience is unlocked: Account Abstraction.
The whitepaper states Biconomy and Particle Wallet have already adopted opBNB’s AA solutions.
BNB Sidechain
Ankr is contributing to this and with their Sidechain-as-a-Service, sidechains can be created for Polygon, Avalanche, and BNB. The details on this are scarce, but they state their BNB sidechain is a set of smart contracts that make the sidechain a modified version of BNB Smart Chain with extra modules like staking pools, governance, dynamic runtime upgrades, reward management, manageable blockchain parameters, and EVM hooks.
BNB Greenfield
It is a decentralized storage and blockchain storage solution platform with programmability via two methods: using smart contracts deployed on BNB Smart Chain or interacting directly with the BNB Greenfield SDK.
BNB Greenfield unlocks varied utilities including:
Websites consist of HTML, CSS, and JavaScript scripts can be hosted in the BNB decentralized network of nodes for increased availability and reduced risk of data loss.
Greenfield offers resources and data types which can be mirrored on the BSC as ERC-721 NFTs.
There’s an SDK that acts as a wrapper to achieve cross-chain communication.
It can be used for creating data exchange platform to list, trade, and sell data assets.
AI
Greenfield can be used for machine learning, more specifically to store models and datasets.
Greenfield nodes handle requests to train/execute models.
It gives projects the ability to choose to use their own machine as execution environment, cloud servers, or Greenfield’s environments (coming in 2024)
DePIN
By itself, Greenfield is already DePIN infrastructure as their decentralized data mechanism unlocks efficient data handling in a secure manner as data is not stored in a single point of vulnerability.
However, there are projects in the BNB ecosystem that are building in the narrative. One of them is more relevant for Gaimin’s DePIN approach:
AIOZ Network is building infrastructure for decentralized AI computation, live streaming, and video on demand.
With over 36k nodes run by individuals, they want to be a provider of decentralized infrastructure for dApps.
They reward users with AIOZ for contributing spare computing power. Nodes’ GPU and CPU computational power are pooled within the AIOZ network to deliver processing capacity for multiple applications.
Opportunities for BNB
BNB Chain’s plans for 2024 sound attractive for developing atop.
Validators will increase to 100.
Improvements are being made to specifically target wider adoption of DeFi, gaming, and AI.
“One BNB” a new interconnectivity concept which will merge the BSC, opBNB, and Greenfield = a unified tech stack.
opBNB will change to “opBNB Connect” to support apps with high DAUs and they’ll reduce gas fees by up to 10x.
Greenfield Executable, a new iteration of Greenfield to solve processing hurdles with large datasets.
opBNB unlocks the efficiency and low cost for many apps, but in Gaimin’s specific case, account abstraction and efficiency sound appealing to make the Web3 experience as seamless as possible.
They state Biconomy and Particle Wallet have already adopted opBNB’s AA solutions so here lies a possible integration for seamless UX.
As mentioned above, Greenfield has applications for AI from which a utility for Gaimin can be developed, using BNB’s infrastructure and a trending narrative.
Not only AI, but Greenfield can be an optimal infrastructure for a DePIN network where nodes’ computational power is pooled for other purposes (AIOZ).
Problems with BNB
The PoSA consensus does sacrifice decentralization to prioritize low block times and security. This is not a problem for the project.
BNB Chain’s gas limit per block and faster block time, the blockchain’s state increases significantly faster than other blockchains.