Binance, the largest cryptocurrency exchange, offers services not only for cryptocurrency trading but also for staking, which allows you to store crypto assets and earn additional passive income. The profitability rate depends on the chosen cryptocurrency and the type of investment: deposits, staking, or Launchpool. We will explore each format available on Binance Earn so that everyone can find the optimal option for themselves.
The Binance platform has the highest trading volume (maximum liquidity) and the best conditions for earning passive income from storing cryptocurrency. It offers an extremely wide selection of tools, and importantly, the exchange supports transfers in Russian rubles through Visa/MasterCard bank cards and payment systems like QIWI, Advcash, and Payeer.
How does Binance Earn work?
All services for passive income on Binance are consolidated under the name “Binance Earn.” You can access them through the “Finance” menu on the exchange’s website: https://www.binance.com. Binance Earn in the “Finance” menu is a simple and secure way to earn in cryptocurrency, including temporarily locking stablecoins with predictable profits, offering a choice of high-yielding coins with above-average risks. Once you have placed your assets in the exchange wallet, you can select one of the dozens of available financial products with cryptocurrencies. Simply transfer your funds, and you are already earning. Locked funds in various products can be unlocked at any time and withdrawn along with the profits. Earnings begin as early as the next day after the deposit. The conditions vary depending on the chosen product, but usually, the profit is displayed on your account management panel as quickly as possible.
Types of Passive Income on Binance Earn
- Flexible Products (Floating Rate): These products provide the flexibility to withdraw your assets at any time without incurring a loss in income. They include floating rate deposits, Launchpool, and BNB Vault.
- Fixed-Term Products: These products offer fixed rates of return and specific holding periods. They include fixed rate deposits, staking, and promotions. A notable product within this category is Ethereum 2.0 staking.
- High-Risk Products: These products provide higher potential returns but also come with unlimited risk of losses. They include DeFi staking, dual investment, and Liquid Swap.
The funds you invest in Binance Earn products are displayed in a dedicated wallet called “Earn” within your account.
Types of Passive Income on Binance Earn:
- Floating Rate Deposits: Floating rate deposits allow you to earn interest on your funds. They are easy to use and offer significant flexibility. You can deposit funds, earn interest, and withdraw them at any time. If you have funds in your spot wallet, why not consider opening a floating rate deposit? Since you have access to the deposited funds at any time, you can put them to work until you need them elsewhere. Please note that interest does not accrue on the day of subscription to a floating rate deposit. The first interest payment occurs on the day following the subscription.
- Fixed Rate Deposits: Fixed rate deposits offer higher profitability but less flexibility in accessing the funds. The difference is that you lock your funds for a specific period to earn interest. The advantage is that these deposits generally offer higher interest rates compared to floating rate deposits since both the duration and rate are fixed. The duration of fixed rate products ranges from 7 to 90 days. Therefore, if you know that you won’t need certain funds for a specific period, you can lock them to earn a higher APY.
- Fixed Staking: By simply holding coins with a Proof of Stake algorithm in your spot wallet, you can earn rewards for staking your assets. However, there is a way to earn higher rewards. If you lock PoS coins for a period of 7 to 90 days, you can earn a higher income. Essentially, this is similar to floating and fixed rate deposits but for staking. Moreover, some coins also support perpetual staking, where you can stake your funds and withdraw them at any time if needed.
These are the various options available on Binance Earn to generate passive income. It’s important to carefully consider the terms, risks, and potential rewards associated with each product before making any investment decisions.
ETH 2.0 Staking
ETH 2.0 Staking on the Binance exchange differs significantly from staking other coins.
- The duration of this staking is not limited by a specific date but by the moment when the Ethereum network transitions to the Ethereum 2.0 protocol (read more about it here). According to developers’ plans, this transition may take more than two years, and early termination of staking is not possible.
- ETH coins locked for staking cannot be unlocked until the current phase of the Ethereum network upgrade is completed. To complete the staking process, a special procedure has been developed.
- After staking is finished, the ETH coins will not be automatically unlocked. Special tokens called BETH are required to unlock them. BETH tokens are issued for free to everyone who locks ETH for staking on the Binance exchange. The number of BETH tokens is equal to the amount of ETH coins locked.
- When unlocking ETH, the BETH tokens used for unlocking will be burned. BETH tokens received during the staking process can be sold on the Binance exchange at any time.
- As of the end of February 2021, the BETH/ETH exchange rate was 0.986, resulting in losses of slightly less than 1.5% when selling. However, even if you sell your tokens, you will continue to receive staking rewards until the new owner of the tokens burns them and claims your ETH coins from staking. Staking rewards for ETH 2.0 are accumulated in BETH tokens, not ETH.
To engage in Ethereum staking on Binance, you need to access Binance Earn, then navigate to “ETH 2.0 Staking” and click on the “Start Staking” button.
Launchpool is a combination of the Binance Launchpad and yield farming. Binance Launchpad is a platform for token launches where promising projects are funded by the Binance user base through initial exchange offerings (IEOs). You may have also heard of yield farming and liquidity mining, where users lock their funds in liquidity pools to “mine” new tokens. Launchpool allows you to lock BNB, BUSD, and other cryptocurrencies to acquire a share of a new token pool launched on Binance. Sometimes tokens are launched simultaneously on both Launchpad and Launchpool. Launchpool is a good way to earn passive income since the cost of acquiring new tokens is only the cost of the locked tokens. Additionally, you can unlock your funds at any time during the farming period.
So, there are quite a few options for passive income from cryptocurrency in 2021. The Binance exchange has developed a wide range of tools to make your savings stored on the exchange generate a stable passive income.