What is Peg?

Pegs are a mechanism that ties the value of one asset to another at a 1:1 equivalent basis. Pegs primarily exist to facilitate the trading of non-similar assets, which is currently hindered because of the reliance on distinct blockchain protocols. Pegging also allows users to exchange specific assets that are pegged at a 1:1 ratio to their native asset (for example, the BEP-2 Binance Chain version of bitcoin (BTC) is pegged to the original Bitcoin network version of BTC) while potentially benefitting from lower transaction fees and shorter confirmation times.