I. Market Context

The Crypto Market 2020-2021 is crazy. If only half a year ago, anyone hypothesized that XRP will out of the top 5 Coinmarketcap, or BNB will be in the top 2 Coinmarketcap, that person will be considered crazy.

However, the second year of Covid in the world has proven that this is a miraculous year. At the time of writing, Binance Coin (BNB) is stagnant at the top 3 Coinmarketcap, behind only Bitcoin and Ethereum, while Ripple's XRP is pushed down to the seventh place.

What makes the Binance miracle? And is this the beginning of a second ETH, or will it be a second Mt.Gox? So many questions are being asked, and no one knows the answer. However, through this analysis, we hope that readers will understand somewhat about the BNB FOMO wave, as well as find out for themselves the answer on whether to invest in BNB long-term or not

II. Binance Chain vs Binance Smart Chain.

1. The Birth and Failure of Binance Chain

Looking back at 2020-2021, BNB is indeed one of the most magical stories of the village of Crypto. In early 2020, there was a time when BNB hit $ 8 with the spectacular Black Swan Black Thursday, March. Since then, BNB has been steadily increasing and peaked at nearly $ 300 in early 2021 with Binance Smart. Chain is on track to overtake ETH.

This story actually started a long time ago, with the full ups and downs of the crypto market. And to be asked if it's worth it, I believe BNB does. And everything started from March, March 13, 2018 to be exact, with a small announcement from the Binance Team:


On March 13, 2018, Binance Chain was officially announced. A year later, in April 2019, Binance Chain was officially born with Binance DEX. And do not know if they were born in downtrend or not, but Binance DEX and Binance Chain have ... failed miserably.

Binance DEX - Binance Chain's main product has no users. Binance DEX's original IDO - Raven Protocol, as well as the Binance Chain-based projects at that time had a negative ROI after the list, even though BNB was still flying.

The main reasons for the failure of Binance Chain are speed (faster than ETH, BTC but still slower than TRX or other 3.0 Blockchain), structure (difficult to build due to fewer documents than ETH that exists from long) and lack of support from other projects and organizations in the industry. However, the main reason why Binance Chain failed in the opinion of that writer is that in 2019, Binance Chain has no DeFi and Money Game.

There is one basic thing that many exchanges, as well as many Crypto projects, have accidentally forgotten after going through a long uptrend. It is a new source of money that will only be poured in, when it has the ability to generate more money. In other words, without the Money Game, there would be no game at all. Looking back, ICO, MLM / Lending, IEO etc all went up when everyone made money together. When everyone makes money, people will invite more people to join. In the financial world, there is no better PR / Marketing form than raising prices.

In fact, Binance and CZ did very well throughout 2018 and 2019. The fact that Binance lived well through the downtrend season is a clear testament to how good CZ and Binance are in making money as well as attracting players. But with Binance Chain and Binance DEX, they may have taken a mistaken move. During 2018-2019, most of the Volume on Binance came from Market Maker using bots to push prices and pump. And on Binance Chain as well as Binance DEX, there is no Orderbook, no limit orders and no bots. The results of Binance Chain and Binance DEX are shown below.

In the list above, we see that there are only 10 names that have positive ROI after the floor list, the rest are pretty strong negative. This is a consequence of many factors, but the biggest one is probably the fact that they are all normal projects, and the inability of users to make money. And when users don't make money, failure is understandable.

And of course, DeFi and Yield Farming are a game-changer. DeFi and Yield Farming not only help ordinary users make money, but it also does one more thing that seemed impossible after the ICO bubble: Advertising and helping new money push into the market. Moreover, Uniswap and AMM also help a new generation of investors born: Market Buy generation, just press swap without knowing the Orderbook.

But Binance Chain and Binance DEX cannot do this, because it does not support Smart Contract and EVM, two of the most important things of Defi. And of course, after the first failure, CZ learned a lot of experience before launching Binance Smart Chain. And this time, Binance was successful.

2. Binance Smart Chain and Rockefeller of Crypto village.

Perhaps it is not an exaggeration to say that up to now, Binance Smart Chain is a great success of Binance. BNB reached the top 3 of Coinmarketcap, PancakeSwap volume reached $ 1.1 billion, Venus Protocol TVL reached $ 3.5 billion, DeFi projects moved to Binance Smart Chain…. However, for the overall picture, we need to go back to where Binance Smart Chain started and what made it a success first.