Cryptocurrency exchange, Binance, announced phase three of its crypto-lending product yesterday. Now users can earn interest on XRP, Litecoin (LTC), and stable coin, USDC. The coins that were already part of the lending schemes were Binance coin (BNB), Ethereum Classic (ETC), and Tether (USDT). Subscriptions are based on a first-come-first-served model and the phase starts on Sept 11 at 6 am (UTC).
The scheme works in the following way. Users deposit their tokens for a fixed term of 14 days and receive a fixed interest rate (paid in tokens) on maturity. Phase two of the product had a 28-day term option, but phase three is limited to 14 days.
There is a total subscription cap to the number of token accepted in each phase, and also a limit on how much an individual can lend. The third phase has an annualized interest rate of 7%. However, BNB and Tether have a 10% annualized interest rate.
XRP, Litecoin, & USDC joins the mix
XRP has an overall subscription cap of 1,000,000, and an individual cap of 50,000 XRP whereas Litecoin has an overall subscription cap of 6,000 LTC, with an individual cap of 300 tokens.
The Stablecoin USDC joins the likes of BNB, ETC, and USDT. The mainstream cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Cardano (ADA) are not part of this phase.
Crypto-Lending: A Controversy
Popular news outlet Bitcoinist reported that not everyone is convinced of whether Binance’s crypto-lending product is a good idea. Bitconnect, a scam crypto company had a similar model that didn’t last long. Comparisons to Bitconnect doesn’t help Binance in any way
Added to this is the problems that come with depositing tokens on a centralized exchange, that had already been the victim of a hack this year. Now even though Customers were not affected by the hack, handing control of keys to such an exchange is never a safe move as hackers are getting better and better by the day.
The first two phases were fully subscribed so regardless of what public media tells you there are still many who believe in Binance’s Crypto-Lending Schemes for better or worse.
Follow us on Twitter, Facebook, Steemit, and join our Telegram channel for the latest blockchain and cryptocurrency news
Instant Crypto Credit Lines™ from only 5.9% APR. Earn up to 8% interest per year on your Stablecoins, USD, EUR & GBP. $100 million custodial insurance.
This post may contain promotional links that help us fund the site. When you click on the links, we receive a commission - but the prices do not change for you! :)
Disclaimer: The authors of this website may have invested in crypto currencies themselves. They are not financial advisors and only express their opinions. Anyone considering investing in crypto currencies should be well informed about these high-risk assets.
Trading with financial products, especially with CFDs involves a high level of risk and is therefore not suitable for security-conscious investors. CFDs are complex instruments and carry a high risk of losing money quickly through leverage. Be aware that most private Investors lose money, if they decide to trade CFDs. Any type of trading and speculation in financial products that can produce an unusually high return is also associated with increased risk to lose money. Note that past gains are no guarantee of positive results in the future.
More from Crypto
The current Bitcoin price rise looks promising. Within a brief moment, Bitcoin (BTC) burst through the $13,000 mark and even …
We already talked about Bitcoin decoupling from the stock market in our last article. It seems that this correlation is …