Binance Pool Launches Fractal BTC Mining with Dual Rewards Capability

Binance Pool has unveiled its latest innovation, introducing merged mining for Bitcoin (BTC) and Fractal Bitcoin (FB) starting November 18, 2024. This new initiative allows users to mine BTC while simultaneously earning rewards in FB, marking a significant step in blockchain mining. However, Binance clarified that FB is not currently listed on its exchange.

What Is Fractal Bitcoin Mining?

Fractal Bitcoin operates as a sidechain built on Bitcoin’s core code, designed to improve scalability while maintaining the security and decentralization of the main blockchain. This dual functionality aligns every Fractal transaction with Bitcoin’s main chain, ensuring consistent adherence to its consensus mechanisms.

The sidechain also employs innovative features like the OP_CAT opcode, which enables applications such as zero-knowledge rollups. These technical enhancements make Fractal Bitcoin a standout option in the layer-2 scaling landscape.

Binance Pool integrates these features into its merged mining model using a Pay-Per-Last-N-Shares (PPLNS) payout system. Participants must set up an external wallet capable of handling a minimum payout threshold of 0.1 FB, with earnings below this amount held until the threshold is reached.

To get started, miners are required to link an FB wallet address to their Binance Pool account and complete Binance’s verification process. Detailed guides are available, making the setup process accessible for both new and experienced miners.

Merged Mining Benefits: A Win-Win for Efficiency and Security

Merged mining allows users to secure two networks simultaneously without additional computational costs. This approach boosts the security of both Bitcoin and Fractal Bitcoin while improving resource efficiency for miners.

The user-friendly interface of Binance Pool offers real-time monitoring of hashrates and earnings, ensuring transparency and operational ease. This dual-mining strategy represents a calculated push by Binance to strengthen its foothold in the competitive blockchain ecosystem.

Fractal Bitcoin’s origin story also resonates with the ethos of blockchain technology. Its mainnet, launched in September 2024, features a genesis block message referencing the financial instability of 2009, a nod to Bitcoin’s inception.

Despite its innovation, Binance has stressed that this mining feature does not indicate plans to list Fractal Bitcoin on its trading platform. This announcement underscores the company’s cautious approach to adding new tokens amidst increased scrutiny from regulators.

Binance’s Strategic Position Amid Intensifying Competition

This new initiative comes at a time when Binance is facing increasing competition from centralized and decentralized exchanges. Over the past year, Binance’s spot trading market share has dropped from 52.5% to 39.5%, while its share of the derivatives market has fallen from 50.9% to 42.5%.

Bybit has emerged as a key rival, now holding the second position in the spot trading market, while OKX and Bitget have gained substantial ground in derivatives trading. These shifts highlight the growing challenges Binance faces as the market diversifies.

Despite these setbacks, Binance remains the largest centralized exchange, handling $22.5 trillion in annual trading volume. The introduction of Fractal BTC mining is seen as a move to counterbalance these challenges by reinforcing its presence in the blockchain ecosystem.

Regulatory Hurdles and External Challenges

Binance’s latest mining initiative also comes against the backdrop of increasing regulatory scrutiny. The U.S. Department of Justice recently filed a civil forfeiture complaint to seize $16 million in cryptocurrency from a Binance account allegedly linked to a bribery scheme involving former FTX CEO Sam Bankman-Fried.

The funds, comprising Solana (SOL), Internet Computer (ICP), Avalanche (AVAX), XRP, and Cardano (ADA) tokens, are suspected to originate from a $40 million bribe to Chinese officials in 2021. This incident highlights the complex challenges Binance faces in navigating both market competition and legal hurdles.

Meanwhile, Binance continues to innovate with initiatives like the ongoing digital ruble pilot and discussions about integrating stablecoins. These developments reflect its commitment to maintaining relevance in an evolving financial landscape, even as it tackles external pressures.