Binance opens deposits and withdrawals for Binance-pegged BUSD on the Optimism Network.
Cryptocurrency exchange Binance has added support for Binance-pegged BUSD on the Ethereum Layer 2 Optimism Network. This integration allows for faster and cheaper transactions of BUSD on the network. In a press release on February 2, Binance announced that users can now deposit and withdraw the wrapped token on Optimism Network.
Ethereum Layer 2 refers to solutions built on top of the Ethereum blockchain to address its scalability and performance issues. These solutions aim to reduce the burden on the Ethereum mainchain by allowing transactions to occur off-chain, while still being secured by the underlying Ethereum network. This leads to faster and cheaper transactions, as well as increased capacity for the Ethereum network. Layer 2 solutions include State Channels, Plasma chains, and Optimism.
Binance-pegged BUSD is a stablecoin pegged to the value of the U.S. dollar. Its purpose is to provide a stable store of value and a medium of exchange that is less volatile than cryptocurrencies such as Bitcoin and Ethereum. BUSD is pegged to the US dollar at a 1:1 ratio, meaning that 1 BUSD is equivalent to 1 U.S. dollar.
By using Binance-pegged BUSD, users can reduce their exposure to cryptocurrency price volatility, while still having access to the benefits of blockchain-based transactions, such as faster and cheaper transfers.
More and more blockchain projects are launching their own stablecoins in an attempt to offer users a more ‘stable’ alternative to crypto, one that can be used for everyday transactions, such as payments, remittances, and trading on cryptocurrency exchanges. Stablecoins are a compromise which aims to provide a bridge between the traditional financial system and the crypto world, making it easier for people to enter the cryptocurrency market.