Binance Smart Chain Popularity Explodes Amid Ethereum Gas Fees Crisis

Gas prices on Ethereum’s blockchain continue to rise, with prices reaching as much as $20 for a transaction. DeFi investors and yield farmers are currently looking for cheaper alternatives on the market. 

The main culprit for the gas price increase is Ethereum’s new all-time high of $1,695.81 on Feb. 4, according to Crypto Browser.io. The move resulted in another spike in transaction costs. Small transactions on Ethereum’s main network are now totally unviable, leaving DeFi projects attractive only to large-scale investors. 

Crypto experts and developers like Julian Koh noted that apart from gas fees, token swaps and other complicated smart contracts have also taken an upward price trajectory. For example, token swapping now costs $180, while more complicated contract calls cost $750.

“This is "crisis" levels IMO, and will seriously drive away users & developers, even if they have to build the app from scratch on another chain,” Koh added.

Indeed, DeFi investors and farmers are already on the lookout for an Ethereum alternative, as the two main choices are Binance Smart Chain and Flamingo. 

For example, Binance’s Smart Chain (BSC) has seen a lot of popularity recently, mostly due to the much lower transaction costs on BSC. Furthermore, data from BscScan show that the total number of unique addresses on the network exceeded one million. Currently, 1,043,671 unique addresses exist on Binance Smart Chain. Also, BEP-20 token transfers managed to record an all-time high of one million, while the total market capitalization of BEP-20 tokens reached $1,87 billion. 

Source: BscScan.com

The activity on BSC gave Binance Coin a push to a new all-time high of little over $54.23, according to data from Cryptobrowser.io

However, Binance Smart Chain is not the only alternative to Ethereum. NEO is also a preferred choice for DeFi investors, via its Flamingo Finance platform. Since the start of 2021, Flamingo is seeing a steady growth in trading volumes, with over $4.2 million traded only in the past 24 hours. Other DeFi platforms are also receiving positive trading volumes and TVL push. The total value locked in DeFi projects spiked to $32.48 billion as of press time, with Maker keeping its dominance over other DeFi projects with 18% of the TVL.