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The Umbrella Network aims to attract more retail and professional validators on its oracle to scale its business to the global market.
Umbrella Network, a decentralized oracle service providing low-cost, scalable, and secure solutions for smart contracts, has defected its long-time partner Ethereum network over cost and scalability issues and joined Binance Smart Chain (BSC). According to the company, Binance Smart Chain is extremely cheaper and scalable in comparison to the former.
“While they have been fantastic partners that we love working with, it is not a true reflection of our community. Shifting over to BSC will immediately allow us to change this dynamic,” the company noted in a Medium post.
According to Umbrella Network, the cost of running a validator on the Binance Smart Chain is 99% cheaper than running one on the Ethereum ecosystem. Thereby making it deviate from its original mission of running a community governed ecosystem.
“The cost of running a validator on BSC is 99% cheaper than what it costs on Ethereum. At 1% of the cost of Ethereum, we can put the control and ownership of Umbrella Network into the hands of the community and increase the number of validators on our network,” the firm noted.
Bigger Picture on Umbrella Network Joining Binance Smart Chain (BSC)
The migration is a huge blow to the Ethereum ecosystem that has been experiencing high transaction fees (gwei) due to network congestion. Moreover, it is one of the most popular digital assets to both retail and institutional investors.
Umbrella Network joining Binance Smart Chain (BSC) from Ethereum ecosystem is a huge plus for the BNB market price. Notably, BSC uses BNB as the native coin for paying fees.
Both Ethereum (ETH) and Binance coin (BNB) have experienced heightened volatility over the past few days. Ethereum continued to scale higher on Tuesday after setting a new record high. Similarly, Binance coin (BNB) followed suit as it hit a new all-time high of $677.47 according to CoinGecko.
The Umbrella Network aims to attract more retail and professional validators on its oracle to scale its business to the global market. Through the partnership with Binance, the largest cryptocurrency exchange by daily traded volume, the firm sees a brighter future on growth prospects.
“Umbrella Network aims to be a community-owned oracle running on a Delegated Proof of Stake (DPoS) system. To achieve this, validators/nodes should be within our community and include individuals and small operators as well as large, well-capitalized professional validators, reflecting the community at large,” the firm explained.
Ethereum developers are working round the clock to roll out the ETH 2.0 that promises affordable gas fees and a scalable network. However, as the demand rises significantly by the day, gas fees are expected to rally further, whereby most retail traders might not afford.
More decentralized financial platforms (DeFi) might follow the same path as Umbrella Network joining Binance Smart Chain, should things remain the same for the next few months.