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This is a beginner’s guide to generating passive income through Binance.
What’s Binance.com ? Binance.com is the largest exchange of cryptocurrencies to the world in terms of trading volumes. In addition to being the largest platform, it is also one of the cheaper than ever when it comes to commissions, but now let’s talk a little bit about Binance Earn.
Binance Earn is a section of the Binance platform where you can discover ways to further grow your portfolio. Basically, instead of letting your cryptocurrency remain idle, you put it to work for the rest of your life. Duration of its stay in your wallet and the most common way to do this is staking.
What is staking ? By betting your coins you are supporting operations on a blockchain network specifies that it in turn rewards you with a certain percentage of your targeted funds. Interest is always given in APY, which means “annual percentage return”, so when Binance returns an APY of 7% if you bet your ADA on their trade, this means you get an annual interest rate of 7% , it is important to note that rewards are paid daily.
Only the proof of stake (PoS) coins are wagered on Binance and although Binance offers more betting options than other exchanges, does not support all coins, as some coins may be bet only on their native app.Binance currently offers about 60 coins for staking which can be The longer you hold your coins, the higher the APY you get. I recommend you choose the longest available. Don’t worry, your coins are not really locked as you can redeem your coins whenever you want, but you will lose the rewards accumulated during the blockade.
Staking Defi ? Some coins are not PoS and therefore are not punctable in the common sense, but on Binance you can still “wager” some of these coins. Currently binance offers 11 coins in Defi Staking.
What is Defi Staking ? This is a “flexible” staking. You don’t choose the betting time, you just bet with higher winning margins. But Binance does not cover any losses in the event of security problems chain out of Binance’s control.
Savings ? Binance Savings are available in two categories, Flexible Savings and blocked savings, while blocked savings have a higher reward, but also a higher risk as you can’t just redeem your coins and sell them. However, if your investment horizon is several years, it doesn’t matter.
What is blocked savings ? You can sign up and block your cryptocurrency for a specific duration in exchange for a much higher interest rate. BUT OFTEN NOT AVAILABLE as there are many users waiting for this section.
What is flexible savings ? Flexible Savings is your Crypto savings account. Earn interest, with the flexibility to redeem your funds at any time. This option has a low APY but is convenient for some currencies who do not have a range of passive earning options.
Launchpool ? On the launchpad of Binance you can bet some cryptocurrencies to get rewards in new coins launched. This normally lasts about a month and new projects are launched sporadically.
What is Binance Launchpad ? Binance Launchpad and Launchpool are platforms that help and advise project teams on how to issue and throw their token at their best.
Vault BNB ? It is a vault specially created to store your BNB coins. BNB is of course the native symbol of the Binance ecosystem and has hundreds of use cases. So if you have bnb it’s a great section to use.
What’s the NBB vault ? BNB Vault is a BNB performance aggregator. Depositing NBB means participating in Launchpool, Savings, Defi staking and other projects and at the same time getting rewards.
Liquidity Pool ? Liquidity pools are one of the key technologies behind the current DeFi technology stack. They allow decentralized trading, lending, yield generation and much more. These are smart contracts that power almost every part of DeFi.
What is a liquidity pool ? Liquidity pools are one of the founding technologies of today’s DeFi ecosystem. They are an essential part of Automated Market Makers (AMMs), Lending Protocols, agricultural yields, synthetic assets, on-chain insurance, blockchain gaming and much more. A liquidity pool are basically funds put together in a large digital stack. When adding to the liquidity pool you can choose to add both tokens in the pair or just one of the tokens adding both tokens results in “0 commissions. After adding to the pool, you can track your funds in your portfolio
under “earn.”
PS: I hope this content was useful and thank you for reading:)
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