ERC20 vs BEP20 Tokens

in LeoFinance2 months ago

Hi there Leo and Hive Family,

Recently, I started to move some of my altcoins that I bought in the summer as some were earning too little interest but were skyrocketing in price so I decided to take some profits. Thus, I kept some of them in my Celsius Wallet but Celsius does not have an Exchange. I had to move them to an Exchange or my Metamask wallet. I was reluctant to do it before because of the withdrawal fees but then saw on the website that there are 0% withdrawal fees currently. So actually it is my time to act. I decided to withdraw my ChainLink to my metamask wallet as it is hot right now but I had never thought thoroughly that I was exclusively using the Binance Smart Chain but all of my previously bought altcoins are actually ERC20 tokens meaning they reside on the Ethereum Mainnet. So checked my balance and saw nothing and then... the realization... Oh.. I made a mistake. I should have withdrawn the ChainLink to Binance. I do not want to pay outrageous fees for simple swaps in Uniswap.

bep2-bep20-erc20.jpg

Source

Well, it is already in my Metamask wallet which has a balance of 0 Ethereum. Good job mate! Your 0% withdrawal fee has been a complete waste. Now what do I do? I have to buy Ethereum and use the Binance Bridge to convert my ERC20 ChainLink to a BEP20 ChainLink so that I can use it in yield farms on the Binance Smart Chain or just forget about it and provide liquidity in Uniswap or Sushiswap. Well, I will see what I will do but I would like to share with you my thoughts after that obvious mischef of mine.

The whole situation got me thinking. I used to have only ERC20 tokens. Now I have both BEP20 and ERC20 tokens. What would happen if I, for example want to withdraw BEP20 tokens to different places and trade them. Well in a lot of places I would simply lose my funds 😨 For example, Celsius have an article warning its users to use the correct networks for their tokens. Easier said that done. I am still quite green in the field so I would have gotten stunned for sure. The best recommendation in such cases is trying out the minimum amount first. If it goes through, then you transfer the whole bunch. If you lose, you lose the minimum.

I have also started to eyeball the wallets string. It is not complete gibberish anymore. Well, at least the first 3 characters. According to the article that I posted above. If the address starts with 0x0, it is an ERC20 token. If it starts with bnb, then it is BEP2 token. If it starts with CRO, then Crypto.com chain. I have also seen a lot of them start with 0x and a random letter and number. I am not sure about those. The only thing I know is that you should be very careful where you deposit or withdraw your assets. An article from Crypto.com warns to look very well to which chain you deposit funds as BEP20 tokens are not supported and you will lose all of your funds.

Just a topic to think about. I know that it is very confusing. It is not clear to me at all but at least now I have this bell in me to think very well and double check my transations. While I now primarily use Binance and its Smart Chain, I can commit an error at any point in time if I try to be ingenious to save money on fees or earn passive income and end up losing my funds in the process.

Posted Using LeoFinance Beta