Introduction

Binance Smart Chain (BSC) is the blockchain that runs parallel to Binance Chain. In this case BSC is geared towards smart contracts, allowing decentralised applications to be traded on a permissionless platform.

No wonder Binance Smart Chain has been able to convince so many users in such a short time. After all, its advantages are immense.

• Independence: Binance Smart Chain is an independent blockchain that also operates separately from Binance Chain.
• High speed: BSC is characterised by extremely fast processes and uses the advantages of Binance Chain.
• Low transaction costs: Especially in comparison to Ethereum, BSC is much cheaper. This makes Binance Smart Chain a worthwhile option for developers and users.
• Compatibility: Binance Smart Chain is compatible with the Ethereum virtual machine and the corresponding Smart Contracts are also compatible with BSC. This also makes it easier for programmers to switch.

On the other hand, Arbitrum is a layer 2 solution designed to enhance the capabilities of Ethereum Smart Contracts, increasing their speed and scalability, while adding additional privacy features to boot.

Arbitrum, in the same way as Optimism, applies Optimistic Rollup technology to enable Ethereum smart contracts to run (in part) on the Arbitrum network. In other words, the aim is for a large part of operations, data transactions and computations to take place on Arbitrum rather than on Ethereum's main Ethereum network, relieving the computational burden on the latter.

To do this, Optimistic Rollup technology allows Ethereum smart contracts to scale by passing messages between the main network and the Arbitrum network.

This whole process enables four advances over Ethereum's other layer 2 solutions:

• Decentralised security
• Full compatibility with Ethereum
• Scalability
• Great cost reduction

In terms of transactions volume, it can be seen how the daily number is higher for Arbitrum network. However, during the alst days, the number decayed dramatically while for BSC the decrease was lower. During the first days, the amount of transactions was around 170k on Arbitrum and 50k for BSC, like 3x more. However, during the last days, the amount was 100k for Arbitrum and 35k for BSC.

In the cumulative chart, we can see how the amount increase rapidly during the first days for Arbitrum but the curve become smoother over time. For the BSC, the curve seems to have a constant increase. During these 7 days, around 330k transactions were executed on BSC while more than 1.3M on Arbitrum.

Comparing the numbers between these two chains, it seems like there exisst a positive correlation between them.

In terms of active users, it can be seen how the daily number started higher for BSC network. However, during these period, situation has been reverted and now there are more active users on Arbitrum.

In this case, the trend was negative from the beginning until the end for BSC passing from 35k to 15k daily users. But, for Arbitrum it started in an uptrend but now it seems like a downtrend has started.

In the cumulative chart, we can see how the amount increase quicker for Arbitrum than for BSC and even starting at a high rates for the second one, the Arbitrum surpassed the BSC line. During these 7 days, 216k users were active on BSC while more than 300k were active on Arbitrum. Here it can be seen how the Arbitrum users do more transactions in average than BSC users.

Comparing the numbers between these two chains, it seems like there is no a significant correlation between them.

Comparing the daily fees of these two chains, in this case we can see a big difference between them. While the BSC has extremelly low fees at a constant average of 0.18USD transaction fee, Arbitrum fees are higher and with a daily increase over time, passing these days from an aveage of 5.5USD per transaction to the current 13.7USD per transaction.

Methodology

The intention of this dashbaord is to provide a comparison between the aforementioned two chains. The main idea is to compare transaction volume for BSC versus Arbitrum over the past 7 days. As well, other metrics have been compared during these 7 past days between these two sites such as:

• Cumulative transaction volume
• Correlation between transactions
• Daily users
• Cumulative daily users
• Correlation between users
• Daily fees in USD
• Success vs failure rate over time

Results

Finally, it can be observe in these final charts both the success rate and fail rate of transsactions in these two chains. As seen, the numbers looks similars over time, being a higher failure on BSC than in Arbitrum. However, the rate of failures are low in both cases, 0.6 vs 0.2 respectively.

Conclusions and insights

In this analysis we have compared two of the most important chains on the crypto ecosystem, BSC vs Arbitrum. We have compared several important metrics focusing on the chains' transactions.

The key insights extracted from that have been the following:

• The daily transaction volume is higher for Arbitrum network. However, during the last days, the number decayed dramatically while for BSC the decrease was lower.
• Comparing the transaction volume between these two chains, it seems like there exists a positive correlation between them.
• The daily active users started higher for BSC network. However, during these period, situation has been reverted and now there are more active users on Arbitrum.
• The BSC has extremelly low fees at a constant average of 0.18USD transaction fee, compared with Arbitrum fees that increased from 5.5USD per transaction to 13.7USD.
• BSC has a higher failure than in Arbitrum.

Then, the main analysis concluded that each of these chains have their own advantages but also their own disadvantages. It seems like users must have to do a prior analysis to be able to be sure the best network for them, depending on the actions they are looking to do.

Sources:

• 1. Binance Smart Chain explained
• 2. Guide to Binance Smart Chain
• 3. Arbitrum on Coinmarketcap
• 4. Qué es y cómo funciona Arbitrum