The rapid rise of DeFi at the start of 2020 has provided a new tangent to the crypto sphere. Due to scalability issues, mass adoption is impossible even though we have managed to capture mass recognition. Binance Smart Chain (BSC) was launched in Sept 2021 to boost the revolution through CeDeFi and quickly became the platform of choice for many developers and investors. It's faster & cheaper than Ethereum but both of them are co-existing right now. Since the market is quite new, it has serious potential to go even bigger in the upcoming years. This provides room for every new platform & chain to grow since all of them have their own pros and cons.
In this blog, I will try to list down the differences between Matic Network and BSC. This would help us to identify which one is the better between the two. 💪
What Is Polygon (Matic)?
Matic Network is a Layer 2 scaling solution that runs over the top of Ethereum Blockchain. It achieves scaling by utilizing sidechains without compromising on the decentralization and security of the Ethereum Network. It has been rebranded to Polygon which has a bigger scope. Apart from their own scaling solutions, they provide Polygon SDK, an extensible framework that supports building multiple types of applications. $Matic is now used as a governance token & also to secure the blockchain (GAS).
What Is Binance Smart Chain (BSC)?
Binance Smart chain is a modified Ethereum's fork and it runs parallel to the Binance chain. It provides a platform to create DApps and other DeFi products through smart contract functionality. It's also compatible with Ethereum Virtual Machine which makes it possible. In early 2021, it got really famous because of Ethereum's insane Gas fees and scalability problems.
Key Differences
- BSC is the modified copy of Ethereum. It uses the Proof of Staked Authority(PoSA) consensus algorithm which is a hybrid between Proof of Authority (PoA) and Delegated Proof of Stake (DPoS). On the other hand, Matic Network is a Layer 2 sidechain to Ethereum which utilizes Plasma framework and a decentralized network of Proof-of-Stake (PoS) validators to ensure asset security. As mentioned above, Polygon is an interoperability and scaling framework for building Ethereum-compatible blockchains. So apart from Matic Network, it wants to connect multiple scaling solutions created by others on their framework with specific functionalities.
- BSC has much lower gas fees than ETH but it is still a few cents. The gas fee on Matic Network is almost negligible.
- BSC is faster than ETH but transactions take good 3-5 seconds to complete, sometimes even more. On Matic, transactions are faster approximately 1 second or less.
- BSC is centralized. It uses a minimum of 21 nodes to run the chain but most of them are owned by Binance, directly or indirectly. Hence, the DeFi platforms built of BSC are actually CeDeFi. Matic is now compromising on Decentralization while providing higher speed and low-cost transactions.
The Winner
Polygon (Matic) seems like a clear champion when you look at the above points. In theory, it performs better than BSC without compromising the security and decentralization of the network. When you look at the markets, BSC has taken the major share and doing more transactions than the Ethereum Network. Even though it is centralized, it hosts a variety of DeFi Applications where people have made a shit ton of money. They have higher TVLs and markert caps. Also, Binance being the biggest crypto exchange in the world has all the resources like developers and funds to create amazing products and market them.
Ether congestion & scalability issues drive the adoption for other Blockchain projects like Polygon, Polkadot, ADA, Cosmos etc. I was having a conversation with @bitcoinflood on one of his recent posts about Polygon and its recent hype. He raised an excellent point about these platforms lacking enough use cases and DApps that are popular enough to really push their demand. It makes a lot of sense because a good product with bad marketing & no users is a bad product. For now, we have to rely on centralized platforms like BSC which are more functional & equipped as compared to others. People don't care about decentralization as long as they are able to cash out. Anyway, it's great to see all these developments happening in the crypto space. The future seems bright to me!!!
Who is the winner according to you? Please share your opinion in the comment section below.