Digital asset exchange Binance is launching a cryptocurrency lending platform later this month.
In a blog post published earlier today, the exchange announced what it’s calling “Binance Lending.” A platform which Binance CEO, Chanpeng Zhao, touted would let users “earn crypto in their sleep.”
Binance is positioning the platform as a “value-add” service for exchange users that hold idle digital assets. In other words, if you have some tokens or coins on Binance that you’re just letting sit there, you could make some money by offering them for use in Binance‘s lending platform.
Users that lend out their dormant coins will earn interest over a two-week period. In the case of Binance‘s own coin, BNB, users could earn an annualized interest rate of up to 15 percent.
According to the announcement, the first phase of lending will be a 14-day fixed term of BNB, USDT, and ETC, starting on August 28, 2019 at 0600UTC.
Binance is capping the amount of coins that can be allocated to the lending scheme and is restricting it by lot sizes. Lending slots are being offered on a first-come-first-served basis. You can track the allocation of coins here.
I have a feeling there might be some dissatisfied users if they aren’t able to subscribe and lend their coins though.
If it isn’t making sense Binance also gave a break down of the interest a user can be expected to earn if they submit their coins to the scheme.
Let’s pretend you buy 10 lots of BNB Lending, each lot includes 10 BNB so this is a total lend of 100 BNB. Over the two-week period you will earn 0.057534 BNB per lot, so for 10 lots that’s 0.57534 BNB.
In other words, loan $2,635 and at maturity earn $15. I mean, thinking of it that way, is it even worth the hassle?
To some people, like margin traders, maybe. To most people, probably not.