Binance is expanding its interest bearing service with the addition of Elrond (ERD) and Tether (USDT) for supported coins at Binance Savings.
The maximum individual limit for Circle’s stablecoin was set to 200 million USDC and the second supported coin was set to 5 million ERD, but Binance says it will adjust the interest rates and maximum individual limits on flexible deposits, based on market and risk factors.
Formerly known as Binance Lending, the savings product allows its users to lend their idle crypto assets on the platform to margin traders, and earn interest on it. The program consists of Flexible Savings, which permits users to redeem their borrowed coins without a long term commitment while getting daily interest as long as margin traders are using their funds.
Binance’s adoption of Elrond (ERD) comes shortly after it signed a new partnership with the developer of Elrond blockchain network, which made its native, USD-pegged stablecoin (BUSD) available on the Elrond Network.
Binance Labs has been an early backer of Elrond project and already led a $3.25 million funding round together with Electric Capital and NGC Ventures. Though Elrond (ERD) was barely known before its Binance hook-up, with the launch of the DEX having already sparked excitement among crypto traders.
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Binance’s Ecosystem Continues to Grow
The major venue originally joined the ranks of other crypto exchanges offering interest-bearing crypto savings accounts in August 2019. This development came just as competition in the crypto lending field was heating up. On the other side, crypto borrowing has also become a popular way for coin holders to use their dormant assets.
All Binance registered users are eligible to borrow on its loans that cover several cryptos, including BUSD and USDT. Binance Loans also supports a range of varying loan periods, with interest calculated on a daily basis, as well as enabling the use of several coins being used as collateral, including BTC and ETH.
The lent coins are used in cryptocurrency leveraged borrowing business on Binance.com, which already offers margin trading.
While loans terms range from 7 to 90 days, borrowers will be given an overdue duration of 3 days, during which they will be charged 3 times the regular interest. However, those who fail to repay their loans after the grace period expires will see their collaterals liquidated to pay off crypto debts.
The launch is another move from Binance in its bid to diversify its business lines to attract and retain users. It also comes months after it rolled out margin trading, lending and revealed plans to add futures trading on its platform.