Cryptocurrency exchange Binance is entering the lending industry with a new digital portal.
The Malta-based firm announced today that it is going to launch ‘Lending Platform’ – a place where Binance users would be able to lend out their holdings and earn a fixed interest income over a specific period. In the start, Binance will allow users to grant loans in three cryptocurrencies: its native asset BNB, Tether’s stablecoin USDT, and Ethereum Classic’s blockchain token ETC. The maturity of each investment would be just 14 days.
— Binance (@binance) August 26, 2019
If the project becomes a success, Binance will increase the period of maturity. Nevertheless, the Lending Platform would keep returning rate of interests based on a pre-adjusted plan. That means each cryptocurrency would return a specific annualized interest rate, with BNB, USDT, ETC returning 15, 10, and 7 percent, respectively.
Binance will make the payouts immediately after loan term matures. The subscription would be available on a first-come-first-served basis.
“If User A subscribes to 10 lots of BNB Lending (total lend of 100 BNB), the interest earned at maturity date will be 0.057534 BNB x 10 = 0.57534 BNB,” the announcement added. “The annualized interest rates for upcoming phases will be adjusted based on market reception of this initial phase. Please refer to future announcements for interest rate updates.”
BNB Price Unfazed
The BNB price remained unfazed by the announcement of the Lending Platform, even though the launch promises a surge in demand for the tokens. As of 1400 UTC, the BNB-to-BTC exchange rate was 25,400 sats, down 3.47 percent from its intraday high. At the same time, the BNB-to-USD price had plunged by 3 percent.
Investors, meanwhile, are keeping their focus on the US-China trade war and its potential impacts on the price of bitcoin, the dominant cryptocurrency.