Binance Launches Public Testnet for Binance DEX, BNB Surges Over 12%

On Wednesday (February 20th), Binance, probably the world's largest cryptocurrency exchange by adjusted trading volume, released a public testnet for the "Binance Chain" blockchain, which means that you can now test the "Binance Chain Explorer" tool and Binance's new decentralized exchange "Binance DEX" (which is powered by "Binance Chain").

Binance Chain

Binance says that ever since its platform was created, there was a vision of one day creating a native blockchain for it. It also wants you to know that this was "a community-driven development project with developers from all over the world" (with, of course, Binance.com as the largest contributor). The idea is to have a blockchain that "will serve as an alternative marketplace for issuing, using, and exchanging digital assets in a decentralized manner." 

Although the Binance Chain is not ready to go live in production, i.e. the Binance Chain mainnet is not ready yet for launch, the public testnet was launched today at 08:00 UTC. 

The first application to be powered by Binance Chain is Binance DEX, a new decentralized exchange (DEX) that "aims to carry over the best features of the current Binance exchange in a decentralized setting, while also offering the benefits and security of a DEX."

Binance DEX

Why should anyone want to use a DEX? According to Binance, these are the main advantages of using a DEX over a centralized exchange:

With a DEX, a person fully holds his crypto funds and directly plug into the network to trade without needing to provide personal information. Unlike centralized exchanges that may be subject to downtimes, a DEX is kept running by nodes distributed around the world and codes that execute functions.

However, the existing DEX options (which nmostly run on Ethereum) have several drawbacks that prevent them from achieving mass adoption:

"The user experience on existing DEX platforms is less intuitive and user-friendly compared to centralized exchanges. In addition, DEX platforms face speed and liquidity issues, which leave them lagging behind their centralized peers."

Therefore, Binance decided to create a blockchain (Binance Chain) that would be secure and fast enough to allow the creation of an intuitive, easy-ti-use DEX that could handle the same "handle the same amount of transactions that the current Binance platform handles," which in its current beta form, according to Binance CEO Changpeng Zhao ("CZ" for short) is around ""a couple of thousand" transactions per second.

How to Try the Binance Chain Testnet

To create your own testnet address, you can use either the Binance Chain Web Wallet or Binance's official mobile wallet (for iOS and Android) Trust Wallet.

You can try Binance DEX at https://testnet.binance.org/. The first step is to create a test wallet. But before you can start doing some test trading on Binance DEX, youj need some funds in your test wallet. You can get 200 test BNB via the testnet faucet, which requires having a Binance.com account and at least a 1 BNB balance (to prevent abuse of the testnet); a few minutes after specifying your testnet address, you will receive 200 test BNB from Binance. 

As for playing with the Binance Chain testnet explorer tool, it is available at https://testnet-explorer.binance.org

Binance has created several helpful tutorials for using the Binance Chain Explorer and Binance DEX. The links for these tutorials are given in the following tweet:

Binance has also created a comprehensive Frequently Asked Questions (FAQ) guide for Binance Chain and Binance DEX, which is available at https://binance-chain.github.io/faq.html

Binance Coin (BNB) Price Action

Due partly to the anticipation of today's launch of the Binance Chain testnet, BNB has had a terrific rally in the past two weeks. As you can see from the two-week chart below (provided by CryptoCompare), the BNB price has gone up from $7.97 at 08:00 UTC on February 6th to $11.01 at 08:00 UTC on February 20th, i.e. an increase of 38.14%:

BNB_two week_20 feb 2019.png

At press time (08:30 UTC), BNB is trading at $10.90, up 12.37% in the past 24-hour period.

Featured Image Courtesy of Binance

tZERO Opened Its Doors to Non-Accredited Investors, but Their Options Are Still Limited

Samuel Haig

Last week, tZERO announced that its securities tokens (TZROP) are now available to be traded to non-accredited investors, as per Rule 144 of the Securities Act of 1933.

Despite the launch, the platform offers limited functionality, Overstock's OSTKO security token and TZROP comprising the only markets that are currently available for non-accredited investors to trade. Traders are only able to place limit and market orders to purhcase security tokens using fiat currency, with tZERO's markets open for trade during weekdays between 9:30am and 4:00pm EDT.

Signing up to trade on tZERO requires submitting identifying documentation to the platform, with verification taking several days for the company to complete. As the platform develops and evolves, however, more functionality is to be expected.

TZROP Tokens to Generate Divident for Investors

TZROP were first issued via a private placement during August 2018, and have been tradable among accredited investors since January of this year. The tokens are now exclusively tradable on the PRO Securities alternative trading system (ATS) to investors who hold an account with Dinosaur Financial - a broker-dealer headquartered in New York.

According to a press release, the TZROP token offers investors “direct exposure to tZERO’s revenue growth through its quarterly dividend model,” with tZERO pledging to distribute 10% of its adjusted gross revenue to holders of its security token . Investors can reportedly choose to receive dividends in the form of BTC, ETH, TZROP, or U.S. dollars.

However, the release notes that the distribution of dividends is subject to approval from tZERO’s board of directors, and Delaware law.

Peer-to-Peer Trading of TZROP Tokens Prohibited

TZERO emphasized that peer-to-peer transfers of TZROP have not been authorized, asserting that TZROP holders must exclusively resell tokens “on the PRO Securities' [...] ATS only through a brokerage account established with Dino, a subscriber to the ATS, with clearing and custody provided by Electronic Transaction Clearing, a registered broker-dealer, and Computershare, as transfer agent.”

To comply with the company’s regulatory obligations, tZERO also reserves the right to prohibit tZERO security token holders from moving TZROP from Dinosaur Financial brokerage accounts to personal wallets.

The chief executive officer of tZERO, Saum Noursalehi, stated:

“Following the one-year anniversary of the close of our security token offering, non-accredited investors now have the ability to purchase and trade in our security tokens. Today marks another milestone as we further democratize access to all investors, regardless of net worth, can invest in the business opportunity of a blockchain-based capital market.”

TZERO Receives Patent for ‘TOME’ Technology

On Aug. 6, 2019, tZERO was awarded a patent for a process for recording trading data on a public blockchain, dubbed the “Time Ordered Merkle Epoch (TOME) methodology.”

According to the company’s announcement:

TOME is a base-layer technology that uses digital signatures to record and verify time-series data such as trades, executions and settlements. This technology enables low-latency systems, including traditional matching engines or private blockchain ledgers, to be anchored into immutable public blockchain ledgers.

TZERO plans to incorporate TOME into its product suite, in addition to licensing the technology to other firms.