About BSC

BSC or Binance Smart Chain is an Ethereum Virtual Machine (EVM) compatible blockchain developed by Binance. The chain runs in parallel with Binance Chain but is different through the support of smart contracts and Dapps. BSC is not a layer 2 rollup solution. It’s a completely independent blockchain that doesn’t rely on Ethereum or Binance chain operation. Thanks to the EVM compatibility, development, and tools than run on Ethereum also can run on BSC.

BSC has its currency used to pay for transaction fees - the BNB token. The fees on BSC are lower in comparison to Ethereum and there is direct support between deposit and withdrawal of cryptocurrency with Binance Exchange.

About Arbitrum

Arbitrum is a layer 2 rollup solution for Ethereum that enables high transactions through output, low cost, and trustless security. Arbitrum uses wrapped ETH to pay for the transaction fees. Users can transfer their assets including ETH to Arbitrum via the bridge. The assets are then wrapped in Arbitrum compatible ones and deposited on the same depositor wallet address. Arbitrum supports the same interface as Ethereum and supports all EVM languages and Ethereum tooling.

Compare transaction volume for BSC vs. Arbitrum over the past 7 days and create a simple visualization to display both. Highlight any interesting points of comparison that you see.

Definitions & Analysis

1. Transaction volume - the total number of transactions that were executed on the blockchain daily over a certain period. In our case, the period is set to last 7 days.
2. Successful transaction volume - Transaction volume with SUCCESS status
3. Failed transaction volume - Transaction volume with FAIL status
4. Daily transaction volume - total number of transactions that were executed on the blockchain for a day.
5. Fee and Average Fee - the cost and average cost to execute a single transaction. Both chains use different currencies to pay the transaction costs. Because of it, some of the transactions within a certain protocol can be less cost-effective.
6. Native transactions - transactions that consist of transferring the native currency of the protocol. (BNB or ETH)
7. Token transactions - transactions that consist of transferring ERC20/BEP20 tokens
8. Networks - BSC & Arbitrum
9. Timeframe - Last 7 days & daily

Transaction volume percentage chart shows us that:

• The Transaction volume on Arbitrum si Higher than on BSC by a big margin within the last 7 days
• Users prefer layer 2 rollups like Arbitrum in comparison to separate EVM chains

Looking at Transaction volume on a daily basis we notice that:

• BSC has an average amount of transactions between 30K and 60K per day
• Arbitrum is in a decline in Transaction volume within the last 4 days
• Arbitrum spikes can be denoted by token activity within certain dapps or token launches on the rollup

Looking at the chart on the left, we can hover and identify the number of failed transactions within both protocols.

• There is more Failed transaction volume on Arbitrum. That’s due to the nature of higher Transaction volume
• There is a spike in Failed transaction volume on Arbitrum on June 29th

From both the Native transactions and Token transactions we can deduct:

• On both protocols, native tokens are less transacted in comparison to tokens
• On BSC the difference between Token and Native Transactions is the highest. This leads to the idea that BSC is mostly used for Defi protocols rather than a layer 2 solution. This confirms the statement from the beginning that BSC is not a layer 2 solution. There is no major reason for people to transfer native tokens.
• Arbitrum is displaying the same falling pattern that we saw in all our previous charts. The Transactions Volume has entered a small recession whereas BSC is stable.

Hovering the circles, we can read the numbers of the Average Fees costs for Arbitrum. From this data we notice:

• Fees are usually low however on the day of failed volume spike, we see a higher amount of average fees.
• In addition, on July 1st, the average amount of fees exceeded 12 ETH !? Strange
• For a Layer 2 solution, fees are pretty high sometimes but I’m sure they are not like that with every transaction.
• The transaction amount doesn’t impact the transaction fee, as the circle size dictates it. The bigger the circle - the more transactions happened on that day

From the BSC Average Fees, we notice:

• Transaction amounts don’t impact the cost of the fees
• Transaction fees are very low. Probably lower than on Arbitrum as they are in micro values
• The fees fluctuate in a range as they probably adjust to the price of the BNB token.

Conclusion

• Both protocols serve their purpose. BSC is very focused on token transactions and Defi around Binance whereas Arbitrum is on the scale and high performance.
• Arbitrum is leading in the competition for the market user. This means that more users are engaged in Arbitrum than in BSC but we assume that both protocols would like to have as many users as possible. Even if BSC is not a layer 2 rollup solution.
• BSC has a stable amount (range) of Transaction Volume while Arbitrum has fluctuations on all fronts, including transaction fees.