What Is BEP-2 (Binance Chain Tokenization Standard)?

BEP-2 stands for Binance Chain Evolution Proposal 2. BEP-2 is a technical standard for creating and using new tokens on Binance Chain. It defines a set of rules and technical specifications that tokens should follow to function in the Binance Chain ecosystem. A very similar token standard in the Ethereum blockchain is ERC-20. For more details on the original proposal, you can refer to the Binance project’s GitHub page. 

While the BEP-2 standard defines the basic and most essential features of tokens issued on Binance Chain, different tokens can still have different implementations for the specific use cases they’re created for. BEP-2 tokens can represent a wide range of digital assets and tradable goods. The standard ensures that they can all smoothly integrate with each other and the surrounding ecosystem. There are BEP-2 stablecoins like, BUSD, BEP-2 pegged Bitcoin BEP-2 and as well as many more multichain projects are using the benefits of BEP-2.

The Binance Chain hosting the BEP-2 tokens relies on the Tendermint BFT consensus and delegated proof-of-stake (DPoS) with a dedicated application layer that runs upon it. These two consensus algorithms proved to be a fast and reliable alternative to proof-of-work.

Each BEP-2 token has the following properties:

• Source Address: Source Address is the owner of the issued token.
• Token Name: Token Name represents the long name of the token - e.g. "MyToken."
• Symbol: Symbol is the identifier of the newly issued token.
• Total Supply: Total supply will be the total number of issued tokens.
• Mintable: Mintable means whether this token can be minted in the future, which would increase the total supply of the token

To learn more about the Binance Chain architecture in detail, you can check the project documentation here.

The native asset of Binance Chain is BNB, which is used to pay for fees (similar to gas). This means that when you’d like to transfer your BEP-2 tokens, you’ll also need to have a small amount of BNB in your wallet. This provides an incentive for validators to include the transactions in the blockchain, as they’ll collect the BNB as a fee for their troubles. 

While the Binance Chain is optimised for ultra-fast trading, it has a sister chain, Binance Smart Chain (BSC) that is focused on running smart contacts and decentralized applications without congesting the original chain. Both chains are complementary to one another in one ecosystem, but are de facto independent. Because of this dual chain architecture, heavy emphasis was placed on cross-chain compatibility. For that reason, BEP-2 tokens can be easily swapped for their BEP-20 equivalent. 

BEP-2 tokens can be traded on Binance DEX, a decentralized exchange that’s running on top of Binance Chain.