What Is the BSC?
The BSC is a blockchain network designed to run smart contract applications. For those who don't know, a blockchain is a type of database. While the specifics can get complicated, a database is essentially a set of information stored electronically on a computer. With a blockchain, information is stored in groups known as blocks, hence the name. When a block is filled, it is chained to a previous block, creating a blockchain.
The BSC operates parallel with Binance's Binance Chain, or BC. This allows users to have access to the higher transaction capacity of BC as well as the ability to use the smart contract applications available from the BSC.
The BSC has grown in popularity in early 2021 due to investors looking for different options with cryptocurrency. The BSC community has been seen as very appealing due to its cost-effectiveness as well as stability.
Launched in 2019 by Binance, BC was created to make fast and decentralized trades using cryptocurrency. However, due to the inherent limitation of blockchains, there was very little flexibility.
BSC was created to allow the use of smart contacts, running side-by-side with the BC. Even if the BC were to stop operating, the BSC would still operate.
Why Put Money Into the BSC?
Investors new to BSC may be wondering why they would want to put their money, specifically the U.S. Dollar, or USD, into the BSC. Unlike other cryptocurrencies, such as Etherum, BSC generally has lower fees. Additionally, the BSC offers the highest returns on your investments. Best of all, transactions are very quick with BSC.
Using BSC is also great for gaining knowledge about the world of decentralized finance. BSC is sometimes referred to as CeDeFi. DeFi is short for Decentralized Finance, while CeFi refers to Centralized Finance. To get a better understanding of Centralized Fiance, think of the middlemen such as banks when you make a transaction with your credit card. To facilitate the transactions, these middlemen have to either accept or reject the transaction. With DeFi, there are no middlemen. However, BSC combines the best of Centralized Finance and Decentralized Finance.
A popular cryptocurrency used with the BSC and BC is Binance Coin or BNB. BNB is the token native to Binance's ecosystem. The primary use of BNB is to pay for transaction fees on the BC. However, many people have found BNB to also be a great investment opportunity due to its projected growth.
When we refer to putting money into the BSC, we are referring to purchasing BNB with the USD.
How To Put Money Into the Binance Smart Chain
The good news is that adding money into the BSC is pretty straightforward. Below you'll find a step-by-step guide that will show you how to transfer the USD into BNB.
1. Create a Binance Account
To get started with buying BNB, you're going to need a Binance account. You can think of Binance as the entry point to buying your cryptocurrency. Started as a Hong Kong cryptocurrency exchange, the platform supports several assets. For this guide, we'll focus specifically on BNB.
To create a Binance account, you need to head over to the Binance homepage and click on the register icon in the top right corner. Once there, you'll be asked to provide an email address along with a unique password. If you have a referral code from a friend, you can also add that here.
After you input your information, you'll have a confirmation code sent to your email address. You'll need this code to verify your identity.
Once you have this set up, you should have a registered Binance account.
However, you'll want to make sure your account is secure. When choosing a password, make sure it's something unique that other users would have a hard time guessing. You may also want to consider changing it regularly to ward off potential hackers.
You'll also want to consider enabling Two-Factor Authentications to help keep your account secure. Doing so requires you to have a code to log in when using a different device. This means that even if a potential hacker knows your password, they would still need access to the code to log in.
2. Choose a Binance Coin Wallet
While not a requirement, if you plan on purchasing and storing BNB, you may want to consider a Binance Coin Wallet. Because BNB is basically a type of Etherum token, there are many wallets that let you store the currency.
There are three types of wallets that you can store your BNB in: Binance Coin hardware wallets, Binance Coin software wallets and Binance Coin web wallets.
The first type of wallet is a hardware wallet. This is by far the safest way to store your BNB. Simply put, a hardware wallet is a physical device that allows you to store your private key to your BNB offline. As long as the wallet is in your safekeeping, no one else can access your coins.
Two popular brands that offer hardware wallets are Ledger hardware wallets and TREZOR hardware wallets.
The first, Ledger hardware wallets, gives you the ability to safely store your BNB with other popular currencies. Ledger hardware wallets come in two models: the Nano S and Nano X. With the latter, you can even access your physical wallet from your phone or computer.
The second type, TREZOR hardware wallets, also come in two models. These are the TREZOR One and the TREZOR Model T. The Model T comes with a touchscreen.
Software wallets are digital wallets that need to be installed on your mobile device or computer. Popular software wallets include Coinomi, Exodus, and Atomic Wallet.
Finally, the last type of BNB wallet is the web wallet. If you don't plan on using your BNB very often, you can just keep it on the Binance exchange website. This can save on costs if you don't own a large amount of the currency.
To use your wallet you'll need to know your Binance Coin address. It'll look like a long string of numbers and letters.
3. Purchase Your BNB
Now that you're registered on the Binance exchange website, you're ready to start purchasing BNB. To do so, you'll have to complete the Know Your Customer (KYC) process. KYC refers to the process that Binance uses to establish your identifying data and contact information.
Once you've established your account, you have two options to purchase BNB. The first option is to use your credit card or debit card. This is by far the easiest method. Your second option is to deposit your fiat currency from your bank account.
For U.S. citizens, we'll assume you want to use the USD to buy your BNB. The easiest and more affordable way to do this is to use your credit or debit card. To do so, click on the Binance welcome screen. From here, you'll want to highlight the "Buy Crypto" dropdown menu. After doing so you'll see a few options. The first is "Credit/Debit Card."
From the "Credit/Debit Card" menu, you can select the currency you want to pay with and the currency you want to buy. In this case, you'll want to select the USD for the payment method and BNB for the currency you wish to buy.
It's that simple. Once your purchase is complete, your BNB will be stored in your web wallet.
4. Store Your BNB Coins Into Your Crypto Wallet
If you decided to use a hardware or software wallet, you can now withdraw your BNB. However, if you plan on using your BNB to help save on fees, you'll probably want to leave it in your BNB exchange account. With that said, if you, like many people, purchased a large amount of BNB for investment purposes, you'll definitely want to keep it safe in your own personal wallet.
The good news is that putting money into the BSC couldn't be simpler. It really is as easy as registering an account and purchasing the currency.
Even better, as the Binance exchange grows, the BNB currency should gain value as well. Opening an account and purchasing BNB is also a great way to get introduced to the world of cryptocurrencies and DeFi. Once you get comfortable, you'll be well on your way to creating a diverse portfolio!
The Beginner's Guide to DeFi The world of cryptocurrency has been moving fast and decentralized finance is a part of it. One of the excellent points about this new movement is the way technology and programmers are showing us a better way to deal with money. Instead of using a system that at times is […]
How To Put Money Into the Binance Smart Chain Buying cryptocurrency has become quite a popular investment option in recent years. You've probably heard of various cryptocurrencies, such as Bitcoin and Etherum. However, a rising cryptocurrency that you should be considering is BNB or Binance Coin. Used primarily with the Binance Smart Chain, or BSC, […]
Introduction Defi lending is part of the world of financial engineering. Defi's goal is to solve a very real problem among those trying to access alternative financial services. Banks have historically been the only way to access credit. Defi provides an alternative way for users to borrow money through cryptocurrencies while ensuring that the funds […]