Yesterday he exchange Binance announced that it has begun to provide the possibility of staking with the DAI stablecoin with an interest of up to 12%.
➡️https: //t.co/HVsU8ePdzU pic.twitter.com/iGNVhVZ84M
– Binance (@binance) August 19, 2020
With this new service, users can block at least 100 DAI and obtain in exchange an interest that ranges between a minimum of 5.8% and a maximum of 12% for at least one month, with a maximum of 100,000 DAI per user.
The limit is 1 million to earn an interest of 12%, 2 million for the 10% that has a time of one week, and no limit for the minimum threshold.
The advantages of DAI staking on Binance
The advantages that Binance offers include the following:
- Ease of use, since there is practically nothing to do except send assets to the participation fund, while avoiding the cost of transactions;
- Security of the funds: the funds are managed directly by the exchange that has full control in case of problems and the possibility of reducing the associated risks;
- High returns: Binance offers a fairly high interest rate that, net of transaction costs, is higher than other protocols.
However, Binance notes that there is always a risk, namely the security risk of the various smart contracts that the exchange will place funds on.
Real DeFi or just marketing?
It should be noted that this new offer, called DeFi Staking, has a very misleading name because it has nothing to do with decentralized finance (DeFi) since the funds are managed by a centralized exchange and not by users, so the parameter disappears decentralization.
And in fact the complaints from this point of view are highlighted in the comments of the news, demonstrating how the word DeFi is used more and more incorrectly or as a synonym for easy money.
At the same time, another exchange, Coinbase, started the DAI Rewards program last month, which allows users, without blocking the stablecoin, to earn 2% on it.