- Binance’s Launchpool platform was presented as a safe way to do yield farming.
- Binance’s native token price (BNB) has seen a 31.80% increase in one week.
After the success of the DeFi sector on Ethereum and its growth to over $8 billion in total value locked, new potential competitors are emerging. In addition to TRON CEO Justin Sun and its sun.market platform, crypto-exchange Binance has now deployed the Binance Launchpool.
The new Binance product was launched a week ago and has been conceived as a platform for users to benefit from the advantages of yield farming securely. The platform uses Binance’s native token BNB and BUSD so that users can stake them for new tokens and a percentage of annual profits (APY).
Currently, users can perform yield farming to obtain BEL, WING and SXP. However, new tokens are expected to be available on the platform soon. Unlike the protocols in the DeFi sector, Binance has promised a secure and reliable way of obtaining yields. In addition, the exchange interface may be easier to use for investors with little experience in the DeFi sector. To access the product, users only need to go to the Binance “Savings page” and click on the available tokens (BNB, BUSD, ARPA) with the label “Launchpool”.
Binance brings the “DeFi fever” to retail investors
Data presented by the exchange and its CEO, Changpeng Zhao, show that the platform has had favorable results. Currently, according to the data from Binance.com users can get an APY close to 90% for staking BNB and 40% for BUSD with the BEL token. About this yield farming model of Binance, a partner of the Spartan Group stated the following:
For the millions of retail crypto investors who can’t keep up with the latest developments in DeFi and the risks involved in yield farming, this is a good way to participate in the yield farming craze in a relatively low risk way.
In order to keep the platform attractive and to keep a head start in the competition of the yield farming that has started between major exchanges such as OKex and Huobi, the CEO of Binance has announced changes to the launch pool. Zhao has suggested retaining the current model, which uses a large deployment pool that offers rewards on all tokens, or introducing separate pools for each project. The decision was left to the community through a poll with a result that seem to support the first option.
Binance has also started to attract projects with its private blockchain, Binance Smart Chain (BSC). Developer Riccardo Spagni, better known as Fluffypony, has defined BSC as an alternative to Ethereum, but “with even faster blocks and without the high fees”. However, members of the crypto community have said that the comparison between the two blockchains is inadequate. The Spartan Group’s partner believes that the entire crypto industry will benefit in terms of adoption:
As the DeFi boom makes its way into the mainstream media, it will draw new comers into crypto who will likely probably participate in yield farming this way.
It remains to be seen whether Binance will be a real competitor to Ethereum in the medium and long term. For the time being, BNB holders seem to be the most benefited. Since the launch of the Lauchpool platform, Binance’s native token (BNB) has seen its price rise by 31.80% in the last one week to $28.98, at the time of publication.