Beacon Chain will close in June and probably reshuffle some tokens in the Binance ecosystem. In early 2024, Binance announced the closure of Beacon Chain, but the immediate news may also attract more attention to BNB Coin (BNB).
Beacon Chain was a temporary solution for orchestrating consensus. Binance directly monitored its other decentralized networks through the BNB Chain. So its closure won’t have a direct impact on Binance Smart Chain.
Holders of BNB tokens may continue to receive passive income after re-delegating their holdings.
Binance recommends using Binance Chain Wallet or Trust Wallet to re-delegate BNB or to find and transfer various types of legacy tokens.
Beacon Chain to Stop All Activities in May
By the end of the month, Beacon Chain will stop all activities and archive their data. The goal is to transfer all Beacon Chain capabilities to Binance Smart Chain, the currently most active network. Beacon Chain will also close its DEX module, as Binance Smart Chain has shown its ability to support complex, highly active DEX trading.
In April, Beacon Chain also stopped issuing new tokens. By the end of May, there will be no more opportunities to transfer the remaining tokens from Beacon Chain to Binance Smart Chain. However, Beacon Chain still allows transfers out of its network as users move BNB coins and various tokens.
Source: BNB Beacon Chain Explorer
Several projects made earlier calls to migrate tokens. For BNB asset balances, users complained of losses or an inability to transfer the tokens. The best approach is to wait until June, the last migration stage, to shut down Beacon Chain.
In June, all former users with addresses on Beacon Chain will have access to a special migration tool to swap all remaining assets.
New BNB Tokens May Enter the Market
BNB Beacon Chain holds several valuable tokens, including wrapped forms of BTC. Currently, most tokens on BNB Chain and BNB Smart Chain are automatically bound and can be transferred between chains.
Some assets created during the Beacon Chain stage may not be bound to their Binance Smart Chain versions. If users do not complete the manual process of migrating tokens, some assets may be lost. The ability to migrate niche tokens may depend on the issuer, and the exact migration steps may differ for some projects.
One of the effects of migration may be on delegated BNB tokens, which will flow into the new blockchain. Some of the delegators may decide to free up their funds, with new tokens entering the market. There is also a manual process to re-delegate BNB tokens and support Binance Smart Chain directly. The migration, which started to accelerate from May 15, arrives at a time when BNB is considered a good candidate for a rally.
To prevent loss, they will migrate more than 95% of all BNBs by the end of May. The remaining tokens may also be transferred soon or lost forever.
Binance will grant enough time to transfer as many tokens as possible. In June, Beacon Chain will have two Sunset forks, the final one toward the end of the month. After that, the former Binance Chain tokens and BSC assets will fuse, and Binance will run only one blockchain.
In the post-fusion stage, a tool may be offered to transfer any remaining tokens. Token issuers still have the task of binding tokens, so the chain switch will be seamless. After the fusion, Binance will also carry only one token standard. The closing of Beacon Chain will sunset the BEP2 token type, and only BEP20 tokens will remain.
Also read: Binance Coin Price Prediction 2024-2030: Is BNB Ready for the Bull Run?
BNB will remain an important asset for both centralized and DEX activity. BNB traded at $598.77, with volumes above $1.3B in 24 hours. In the past quarter, BNB activity was consistently above $1B, reaching a peak above $4B.
BNB keeps within a tight range, serving a function in Binance trading pairs, as well as in liquidity pools on Pancake Swap. About 6.28% of the BNB supply is staked for passive income.
Cryptopolitan reporting by Hristina Vasileva
