Binance now has a new yield token that offers a dual reward to investors who can simultaneously earn and trade with the token.
By Godfrey Benjamin
Editor Hamza Tariq
Updated
3 mins read
Binance, the world’s largest digital asset exchange by trading volume, is set to launch a new product called LDUSDT. This upcoming product will allow users to trade crypto futures while earning additional benefits from their locked USDT funds.
Binance’s latest product, LDUSDT, is designed as a reward-bearing non-stablecoin margin asset. This asset is the second of its kind on the platform, following the earlier introduction of BFUSD in November.
It is worth mentioning that the new updates were developed to improve capital efficiency and user experience. The update will remove the need for users to choose between earning interest and maintaining trading volume.
To get access to LDUSDT, users will have to first subscribe to Binance’s Simple Earn Tether (USDT) Flexible Product. Normally, when users lock their USDT in this product, the funds are held and cannot be used until redemption.
With LDUSDT, users will be able to convert their locked USDT into a margin asset for futures trading, while still earning rewards.
LDUSDT will give users access to real-time rewards and the ability to trade futures. The current real-time APR for this reward is around 1.5% and updates every minute. This means users will be able to earn interest on their holdings without missing out on market opportunities.
According to Binance, the coin is expected to go live later this month.
The launch of this product came days after Binance announced a partnership with WorldPay. The collaboration intends to simplify crypto purchases using Apple Pay and Google Pay, broadening access to over 1,000 payment methods worldwide.
While both LDUSDT and BFUSD are reward-bearing margin assets, they have different purposes. For example, BFUSD generates returns through a model that involves delta-hedging between spot and futures markets. It also collects funding fees and allows users to earn from staking.
Binance Futures recently updated BFUSD to include USDC support. This means users must buy and redeem either USDT or USDC to access the associated rewards.
In contrast, LDUSDT simplifies the process. There is no need for complex hedging or switching between products. It builds directly on the Simple Earn USDT Flexible Product and allows users to make their locked assets work in futures markets while continuing to earn the real-time APR.
Binance has also confirmed that the APR for LDUSDT will never go below zero. This mirrors the existing policy for the Simple Earn Flexible Product. The platform does not offer negative APR on any of its reward-bearing products.
Jeff Li, Binance’s Vice President of Product, said the success of BFUSD led to the launch of LDUSDT. He stated that this new option increases capital efficiency and flexibility for users, allowing them to use one asset for both trading and earning.
Binance reports over 10 million active users for its Earn products, and the platform claims a total user base of more than 250 million.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
