As part of a wider exodus, the highest-profile Ethereum-native decentralized finance (DeFi) project yet has announced an expansion to Binance Smart Chain.
In a press release today, the 1inch team revealed that they’ve ported 10 million 1INCH tokens (currently worth over $40 million dollars) to BSC. The tokens will be used as a liquidity bridge between Ethereum and BSC, and will seed the 1inch ecosystem on BSC, including the 1inch Aggregation Protocol and the 1inch Liquidity Protocol.
“As we at 1inch are always on the lookout for the hottest DeFi projects, the addition of BSC-based DEXes to our aggregation protocol came as a natural step,” reads the announcement.
In a written interview with Cointelegraph, 1inch co-founder Sergey Kunz cited rising popularity and lower gas costs as the inspiration for the expansion.
“Currently, we consider BSC to be an alternative solution to the Ethereum mainnet in terms of lowering gas costs for interacting with smart contracts,” he said. “As gas price stays too high we see a lot of projects, tokens and users coming to BSC, and this is the right moment for the 1inch to expand to other blockchains.”
BSC has been the target of criticism from some members of the Ethereum development community who accuse the layer-1 of centralization. Binance documents report that the network is run by 21 validator nodes, all of whom are anonymous.
When asked about these criticisms, Kunz dismissed them, and indicated that the 1inch team would be taking an active role in the network:
“We don’t know for sure if the BSC is centralized as we don’t know who are the validators of their network. But 1inch plans to run its own validator on BSC.”
Kunz also notes that the 1inch team “didn’t receive any grants or technical assistance in terms of this integration from Binance,” and that the team doesn’t “know for sure” if the bridge used to port 1INCH tokens to BSC was fully decentralized.
The team also said that they did not consult with community governance on the expansion.
“Since nothing changed for 1inch users within the Ethereum network, we don’t think it’s necessary to ask any one about such initiatives from our side. It’s just an expansion of the 1inch Network which is beneficial for all participants,” said Anton Bulkov of the 1inch team.
On the 1inch governance forums, a team member notes that “1inch DAO is a collective of 1inch stakeholders – individuals interested in making the 1inch Network permissionless and decentralized and, therefore, efficient and secure for all users.” This purview ostensibly includes “fundamental changes that could be suggested and accepted via the voting process on the Forum.”
1inch joins a growing number of projects who have either announced expansions to BSC or are planning them. This comes on the heels of Binance freezing withdrawals on ETH, a move that some interpreted as an attack on the rival chain.
Ray Schuetz received a Masters Degree in computer science from The University of Texas (Austin). Ray has been working as a full-time blockchain consultant for the past 3 years. In his spare time, Ray enjoys writing for EthereumCryptocurrency.com and other crypto news publications.