Binance stays to be one of the biggest exchanges for cryptocurrency exchange when we compare it with volume. Just in the past month, there have been more than $ 27 billion worth of the transaction. This has been making huge headlines since April this year as they had also announced the launch of the Binance chain. The platform further went over executing the exchange of the native token BNB off the Ethereum Blockchain and also launching decentralized exchanges.
This was one of the moves from a futuristic cryptocurrency and had been intended for helping build based on the issue of new cryptocurrency and the initial coin that offers tokens.
With this being the objective in mind Binance Chain had also become a strong platform for helping new projects. Of course, Binance does provide their chain for which they had issued and has been operating the native BNB token, but just the fact that it also is a blockchain platform has suddenly made it a competitor for Ethereum which is huge.
Although Binance had been trying to push boundaries when we speak of cryptocurrency exchanges, and what this can be, this has been an interesting move. Some part of its success has been got from BNB but another one has come from their will of launching and accepting varied coins on the platform as well.
But when we speak of the Binance chain, there are key things that you should be completely avoiding. Let’s take a look at them:
Top Things to Avoid In Binance Chain
1. Never Send Real Mainnet Token for Testnet
Keep in mind that the testnet for the Binance chain has been mainly made for testing purposes. The normal users will be able to play with this feature for trying any of the new features, the providers for a crypto facility like wallet creators. They can test the integration with the Binance chain and the traders can test some of the strategies.
But remember that all of this consists of testing tokens and has absolutely no financial value for benefits linked with them. The testnet funds never are equal to the mainnet funds or the account funds on Binance.com.
So please keep in mind of never sending any kind of real mainnet tokens like BNB, ETH, or BTC on testnet. This will lead to your tokens getting lost and shall be unrecoverable. In case you want to try a test token, you need to visit the test fund faucet on their official website.
This is free, and all you require is an account on Binance.com with 1 BNB in your account while you apply. You will be able to spend 1 BNB after you get the test fund and one can get funds for several addresses through one account.
2. Don’t Share Private Key or Mnemonic Phrase With Anybody
In case you share this critical information, others can take the funds you own and you shall lose complete control over the fund. Remember that this is a situation where the Binance or the chain validators won’t be able to help you out at all. So make sure you are not sharing the private key with another person. If someone claims that they are the customer support, still don’t do that.
3. Don’t Forget/Lose the Mnemonic Phrase
As we mentioned above, if you lose the private key and mnemonic phrase you will be at risk of losing fund access. And nobody from their official team will be able to help in the recovery of mnemonic phrases and keys. Therefore it becomes critical that you are recording the phrase with complete safety and making sure that only you will be able to access it whenever needed and no other person.
4. Never forget writing down the Mnemonic Phrase
Your mnemonic phrase is the only way by which you will be able to recover the private key. It is also going to be used frequently in several hardware wallets for generating seeds for more private keys. This will be your best way for key recovery and it’s recommended that you write it and keep it in some safe place.
In case you need information the mnemonic phrase in the Binance chain has been following the protocol called BIP39 and using BIP44/BIP32 for generating the private key.
5. Don’t Keep Using Private Key or Mnemonic Phrase for Unlocking Your Wallets
When you keep using the private key and mnemonic phrase, there is a higher probability of you losing it because of phishing applications or websites. Mnemonic phrases and private keys must be only used for recovering the hardware wallets, Keystore files, or the mobile wallet.
It’s highly recommended that you are using trust wallet, Keystore file, hardware wallets for unlocking the wallets.
6. Never Use Trading Bots or SDK that aren’t A 100% Reliable
While you are using trading bots or SDK on DEX, one has to add the private key in the software or libraries. And this can be the time when one exposes your private key for risking or leaking and becoming the victim of phishing.
So make sure the trading bots and SDK are completely trustworthy. The platform recommends using their signing service that will be a feature they will add soon.
7. Try Not Sending Aggressive, Large Orders At One Time
Binance DEX makes use of different matching logic when compared with Binance.com. The main difference for a user here will be over trading big, aggressive orders. When you are sending all at one time, the engine will be considering that there is a sell surplus or big buy and end up with the worse trading cost for you.
So make sure you are sending small pieces when you need to sell or buy a big amount.
8. Don’t Associate Any Gains or Benefits Through Tokens Over Testnet Of Binance Chain
As we mentioned in the first point, the testnet is mainly for testing purposes. The testnet fund and tokens in the addresses can be subjected to resetting while upgrades of testnet. Be aware of any phishing or scams that are offering your gain or benefits over tokens on the testnet. There isn’t any monetary value of testnet tokens.
Frequently Asked Questions
What is the Binance Chain?
What should I avoid when using the Binance Chain?
What should I do if I encounter suspicious activity on the Binance Chain?
Is it safe to use the Binance Chain?
How can I stay updated on security measures and best practices for the Binance Chain?
Bottom Line:
Although there are several aspects of security where the Binance ecosystem has been working on for keeping the user’s data and funds protected, there is still a need for awareness among their users. The core team has been putting all efforts into making sure better services and infrastructure can be provided.
But you as a user should be constantly working towards making sure that you don’t take a wrong step from your side that leads to loss of the funds you have. Hopefully, the guide above provides you critical information on the things that need your attention for making sure you stay safe!
