What is Wrapped BNB?

Wrapped BNB (wBNB) is a unique kind of BNB token that complies with the standards and specifications necessary to participate in smart contracts. While the Binance Smart Chain utilizes wBNB to fuel the projects on top of it, the Binance Chain employs BNB as its native currency. The higher requirements that WBNB must fulfill let it interact with Ethereum-compatible projects.

It may be exchanged for the original BNB token at any time, and its financial worth is pegged to the value of the BNB asset. In plainer terms, the wrapped BNB may be thought of as a stablecoin whose value is derived from the token from which it was created.

The availability of several blockchains with different capabilities hinders tokenized interaction and, as a result, restricts cross-chain transactions. As a result, the wrapped BNB was developed to enhance the interoperability of the Binance Smart Chain (BSC).

The wrapped BNB uses BEP20, the default version on the Binance Smart Chain that enables it to be utilized by other apps, to aid in cross-chain transfers.

That being said, let us learn what is wrapped BNB actually, and the difference between BNB and Wrapped BNB.

Why Wrapped BNB (wBNB)?

Because of the interoperability it provides, wrapped wBNB is a special token created by the Binance Smart Chain development team. Compared to its predecessor, wrapped wBNB can interact accurately with complex decentralized applications and abide by a number of smart contracts, allowing the Binance Chain to perform new functions.

One of the most secure smart contracts in the world, the wrapped BNB has never been the target of a hack or fraud. It has a very intricate consensus method that guarantees the security of the money. Additionally, there are efforts to increase the security of smart contacts. And this will protect its value, expand its current capabilities, encourage transactions, and improve its scalability.

BNB wrapped is safer than BNB. Even if BNB is sufficiently safe, using wrapped BNB assures it. Once a coin has been wrapped, it is given a unique private key that the user may manage. If they are striving for speed, which is what most hackers these days focus on given the speed with which intrusions are discovered and stopped, hackers will leave an account with a private security key alone.

Because of its many uses, individuals may now utilize wBNB instead of the unwrapped BNB coin to complete tasks without devaluing the latter and thereby enhancing the Binance ecosphere. Let us look at its features:

Features of Wrapped BNB

Better efficiency: Boost the capital efficiency of centralized and decentralized exchanges.

Take advantage of the standard BNB token: Even if the wBNB is wrapped, this does not take away from the advantages of using a BNB token. Holders can still use it in businesses that accept them to conduct transactions and even make purchases.

Discount Voucher: When you own the wrapped BNB token, you may still benefit from the usual discount Binance provides its BNB holders, enabling you to contribute to the development of the neighborhood.

Encourages interoperability: By acting as a link between blockchains, Wrapped BNB enables users to move across networks while conducting financial operations.

Reduces liquidity: Because the liquidity of other blockchain networks can be financially taxing, the tokens are wrapped in a blockchain with lesser liquidity, and the intended transaction is carried out without any problems.

Decreased gas fee: High gas fees are one of the drawbacks of utilizing cryptocurrencies; however, by employing wrapped BNB tokens, users may conduct transactions with little to no gas costs.

Wrapped BNB Vs BNB

When you understand how the Binance blockchain functions and the initial motivations for Wrapped BNB's release, the distinction between BNB and Wrapped BNB will be clear to you.

• Technically, Binance Coin (BNB) debuted immediately following the Binance Chain. Users may easily swap, use, and issue digital currencies on the blockchain thanks to the Binance Chain initiative. BNB is the only currency used there.

• However, after the introduction of the Binance Smart Chain, Binance now employs a dual-chain system:

• It is a different blockchain that was introduced in parallel to the Binance ecosystem to enable programming on the Binance Chain.

• The Binance blockchain may now handle numerous smart contracts and the Ethereum Virtual Machine in addition to carrying out its previous functions thanks to the Binance Smart Chain.

• In essence, Wrapped BNB is like BNB on steroids since it has considerably more functionality.

• The applications of BNB and wBNB differ from one another. Because Binance Coin does not adhere to the BEP-20 standard, as was previously noted, you cannot swap it for many other tokens.

• BEP-20 can be viewed as an expansion of the ERC-20 specification. Any coin on the Binance Smart Chain may now be used by wallets and other third-party programmes like DEXs thanks to this standard.

• Because of this, there is a demand for a wrapped version of Binance Coin based on BEP-20 that can be easily exchanged for any other tokens on the chain.

• Users require wBNB to accomplish goals other than BNB's without undervaluing the latter or further developing the Binance ecosystem.

How is the network for wrapped BNB secured?

One of the most secure smart contracts in the world, the wrapped BNB has never been the target of a hack or fraud. It has a very intricate consensus method that guarantees the security of the money. Also, there are efforts to increase the security of smart contacts.

Moreover, this will protect its value, expand its current capabilities, encourage transactions, and improve its scalability.

Criticism of Wrapped BNB (wBNB)

Wrapped BNB has a strong central location. The currency is heavily controlled by Binance. Binance owns Wrapped BNB to more than 80%.

• Although Binance is a cryptocurrency market in and of itself, the centralization of wrapping BNB puts them in conflict with one of the fundamental tenets of the technology, which is that no central authority should have any influence over an individual's funds. This is a problem even if Binance is a decentralised coin.

• WBNB packaging and unwrapping costs money. Since users are responsible for covering the cost of gas, that expense arises from working on the wrapping and unwrapping of tokens.

• This may result in the user paying more than the token's initial cost. Because of this, WBNB can only be used for big or high-value transactions; otherwise, it would be more expensive to transact than the token itself could be worth.

• To wrap and unwrap cryptocurrency, Wrapped BNB uses custodians. These custodians might be multi-signature wallets or smart contracts. The custodian might not function properly if it is corrupted. For instance, if the custodian were compromised, it may drain the bitcoin in a transaction rather than unwrap it.

Wrapped BNB (wBNB): History

Changpeng Zhao, a Chinese-Canadian who is also the CEO and founder of the Binance platform, is the founder of Wrapped BNB (wBNB). He and his team, which included individuals with a variety of personalities, created the Wrapped BNB (wBNB).

They have created the greatest instructional module to present a number of rational facts supporting the idea of wBNB in order to keep their consumers on board.

The cryptocurrency was intended to be a component of the Binance platform and enables the usage of Binance's liquidity across other blockchains. It is simple to go from BNB to Wrapped BNB and from Wrapped BNB to BNB.

How can I buy wrapped BNB (wBNB)?

Because regular users don't need to worry about the wrapping and unwrapping procedure, the wrapped BNB may be traded directly with other alternative tokens. The procedures below make it simple to buy wBNB tokens.

• Sign up for a trading account on the cryptocurrency exchange.

• Deposit the specified sum in your account in fiat money.

• When your deposit has been verified, purchase wBNB using your trading account.

FAQs

Is wrapped BNB the same as BNB?

The wrapped BNB, also known as the wBNB, is a tokenized form of the BNB that serves as an alternative cryptocurrency for the Binance Smart Chain (BSC). It may be exchanged for the original BNB token at any time, and its financial worth is tied to the value of the BNB asset.

Why do you need to wrap BNB?

It is not possible to simply move coins that are present on one blockchain to another. To get over this restriction and employ non-native assets on a blockchain, use wrapped tokens.

Can you use wrapped BNB on PancakeSwap?

PancakeSwap allows you to immediately wrap and unwrap BNB and WBNB with no trade costs.

What is wrapped BNB used for?

Wrapped BNB is a unique kind of the $BNB coin that complies with the standards and specifications necessary to participate in smart contracts. While the Binance Smart Chain utilises $WBNB to fuel the projects on top of it, the Binance Chain employs $BNB as its native currency.

What is Wrapped BNB Token Address?

Binance Smart Chain Mainnet has wrapped the BNB (WBNB) ERC20 token. Using address 0xbb4cdb9cbd36b01bd1cbaebf2de08d9173bc095c, the token is implemented as an ERC20 smart contract.

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• How Does BNB coin works
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• History of BNB coin