Binance has launched a new service called Binance Lending, allowing customers to utilize the crypto they hold for lending.
// STAY UP TO DATE – FOLLOW BLOCKCHAIN DAILY ON TWITTER: @BLCKCHAINDAILY
“At Binance, we constantly find ways for you to get opportunities to earn beyond trading and the newest addition to this slate of opportunities is Binance Lending,” the company stated.
How Binance Lending Works
With Binance Lending, storing, holding, and earning crypto at the same time is possible, with just a few clicks.
The company is launching Binance Lending with products for Binance Coin (BNB) and stablecoin Tether (USDT), with support for more tokens in the future.
Customers can also borrow funds from Binance Margin to subscribe to Binance Lending.
Upon launch, Binance Lending users will be able to subscribe to a lending product on a first-come, first-served basis. Users will decide the amount of tokens they want to lend at the time of subscription.
The designated hard cap is 500 BNB per account for BNB-denominated lending products. Meanwhile, the hard cap for USDT will be 1,000,000.
Once subscribed, the funds are stored on a time deposit with a 14-day period for the initial products.
During this time, users will not be allowed to withdraw the funds they put into the lending product.
The company also stated other upcoming lending products may offer other lending periods.
For the first few lending products, the allowance, or the maximum amount of funds to be enrolled within each product, will be 200,000 BNB and 10,000,000 USDT.
What Do I Get From Binance Lending
“The main benefit of using Binance Lending is the opportunity for passive gains with your crypto,” stated Binance.
“Whether you’re a crypto HODLer trying to maximize gains or a frequent trader who wants to take a break from the action, Binance’s Lending products allow you to accrue interest and increase your token balance regardless of how the market moves.”
The annualized interest rate for the initial BNB lending product, which has an initial 14-day period, is set at 15 percent.
This means if you store 500 BNB for a year on the lending product, your BNB balance would grow 15 percent, or by 75 BNB, on a yearly basis.
This translates to a gain of 2.875 BNB after just 14 days.
The BNB you put into Binance Lending products will also be counted under the daily calculation of BNB balances. This is particularly useful for participating in promos and Binance Launchpad token sales.
If you have 0 BNB in your spot account but subscribed to a Binance Lending product using 100 BNB, the BNB you have in the lending product will be counted within your daily BNB calculation.
If you intend to participate in Binance Launchpad and meet all other requirements, you will still be entitled to 2 lottery tickets based on the most recent lottery rules.
What’s Next for Binance Lending
We intend to continue enhancing and introducing new products to Binance Lending soon after launch. We will add more to the list of cryptocurrencies eligible for lending.