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Trading isn't the only way to make money in crypto; simply holding your coins can also generate interest. Binance Earn provides exactly this opportunity, allowing you to deposit your cryptocurrency to earn interest without having to constantly watch the market. You can purchase various financial products directly on the official Binance website. Operating through the official Binance App is even more convenient, allowing you to check your earnings at any time. Apple users should first refer to the iOS installation guide to install the app.
What is Binance Earn
Binance Earn is a one-stop cryptocurrency investment platform launched by Binance. You can deposit your various cryptocurrencies into different financial products to earn interest yields. It's just like depositing money in a bank to earn interest, except here you are depositing cryptocurrency.
Binance Earn includes multiple product types: Flexible Savings (flexible subscription and redemption), Locked Savings (locked for a period), ETH Staking, Dual Investment, and more. Different products have different yield rates and risk levels.
For beginners, the most basic and easy-to-understand options are Flexible Savings and Locked Savings. Understanding the differences between them will help you choose the investment method that suits you best.
How to Purchase Earn Products on Binance
Step 1: Enter the Earn Page
Tap "Earn" at the bottom navigation bar of the Binance App, or find the "Earn" option in the top menu of the web version. This will display all available financial products.
Step 2: Choose an Investment Type
The page categorizes different Earn products. You can search by coin (like USDT) or filter by product type (Flexible, Locked, etc.). Each product will display an estimated Annual Percentage Rate (APR) or Annual Percentage Yield (APY).
Step 3: Select a Specific Product and Subscribe
Click on the product you are interested in to view detailed information, including the yield rate, subscription duration, minimum subscription amount, etc. Once confirmed, enter the amount you wish to deposit and click the "Subscribe" button.
Step 4: Confirm and Wait for Interest Accrual
After a successful subscription, interest usually begins to accrue the next day (T+1). Flexible products can be redeemed at any time, while locked products can only be withdrawn upon maturity.
Detailed Explanation of Flexible Savings
Flexible Savings is also known as "Flexible Subscription and Redemption." Its biggest feature is that you can deposit and withdraw at any time without a lock-up period.
Characteristics of Flexible Savings
High flexibility: You can deposit at any time and redeem at any time. After redemption, funds usually return to your Spot Wallet within minutes to a few hours.
Relatively lower yield: Because there is no lock-up period, the yield of Flexible Savings is usually lower than that of Locked Savings. Taking USDT as an example, the annualized yield for flexible savings is generally between 2% and 6%.
Daily interest: Interest is calculated daily and automatically distributed to your Earn wallet every day. You can set up "Auto-Subscribe" to reinvest the interest and achieve a compounding effect.
Supports many coins: Flexible Savings supports dozens or even hundreds of cryptocurrencies, including mainstream coins like BTC, ETH, USDT, and BNB.
Who is Flexible Savings Suitable For?
People who have cryptocurrencies they aren't using temporarily and want to earn some interest while waiting. People who are unsure when they might need the funds and want to be able to withdraw them at any time. Spot traders who want to put idle funds into Flexible Savings when not trading.
Detailed Explanation of Locked Savings
Locked Savings, also known as "Staking," requires you to lock your coins for a specific period, and they can only be withdrawn upon maturity.
Characteristics of Locked Savings
Higher yield: Because you commit to locking your funds for a period, you are compensated with a significantly higher yield compared to flexible products. For the same USDT, the annualized yield for a 120-day locked period might reach 8% to 12%.
Fixed duration: Common durations include 30 days, 60 days, 90 days, and 120 days. You cannot withdraw funds during the lock-up period (some products allow early redemption but you will lose your interest).
Daily interest: Interest is similarly calculated and distributed daily. Upon maturity, the principal and the final day's interest are automatically transferred back to your Spot Wallet.
Quota limits: Popular high-yield locked products may have quota limits. Once full, you cannot purchase them anymore and must wait for the next open period.
Who is Locked Savings Suitable For?
People who hold a certain cryptocurrency long-term and do not plan to sell it in the short term. People seeking higher yields and are willing to accept that their funds will be temporarily immobilized. People with a clear investment plan who know how long it will be before they need the money.
Detailed Comparison Between Flexible and Locked
Yield Comparison
The yield of Flexible Savings typically fluctuates between 1% and 6%, depending on the coin and market supply and demand. The yield for Locked Savings usually ranges from 5% to 15%, with longer durations offering higher yields.
For the same coin, the yield of locked savings is generally 2 to 3 times that of flexible savings. For example, USDT flexible might be 3%, locked 90 days might be 7%, and locked 120 days might be 9%.
Liquidity Comparison
Flexible Savings can be redeemed at any time, offering excellent liquidity. It's suitable for people who need access to funds on demand. Locked Savings cannot be withdrawn during the lock-up period (or early redemption incurs interest loss), resulting in poor liquidity. It's suitable for long-term idle funds.
Risk Comparison
The fundamental risks of both are similar, involving platform risk (if the exchange has issues) and price volatility risk. However, Locked Savings carries an additional risk: if the coin's price plummets during the lock-up period, you cannot sell to stop losses. Your coins are locked, and you can only watch as you incur losses.
Therefore, Locked Savings is more suitable for depositing stablecoins (like USDT, USDC, etc.), as their price volatility is minimal, eliminating the risk of a price crash during the lock-up period. If you use volatile assets like BTC or ETH for locked savings, you must bear the risk of price fluctuations.
Actual Yield Calculation
Suppose you have 10,000 USDT. Depositing it in Flexible Savings at an annualized rate of 3%, the daily interest = 10,000 × 3% ÷ 365 ≈ 0.82 USDT. That's about 25 USDT in a month.
Depositing it in Locked Savings for 90 days at an annualized rate of 8%, the daily interest = 10,000 × 8% ÷ 365 ≈ 2.19 USDT. The total interest for 90 days is about 197 USDT.
The difference is quite clear. If you are certain you won't need the money within 90 days, locked savings is obviously more cost-effective.
Other Products in Binance Earn
Dual Investment
Dual Investment is a structured product that allows you to deposit one coin while setting a target price. Upon maturity, if the target price is reached, your coin is converted into another coin, and you earn a high yield; if the target price is not reached, you receive your original coin plus interest.
The yield is usually much higher than standard Earn products, but the risk is also greater because it involves currency conversion.
ETH 2.0 Staking
Deposit ETH to participate in Ethereum's Proof-of-Stake (PoS) validation and earn staking rewards. This is a long-term yield method, where the rate varies based on the total staked amount across the Ethereum network.
Launchpool
Use BNB or other designated coins to participate in farming for new projects and receive free new tokens. This will be detailed in a separate article.
Things to Note When Buying Earn Products
First, pay attention to the difference between APR and APY. APR is the simple annualized percentage rate, while APY is the compound annualized percentage yield. For the same numerical value, the actual return of APY is slightly higher than APR.
Second, note whether the yield rate is floating or fixed. The yield of Flexible Savings is floating and may change. Some Locked products have their yield locked at the time of subscription, while others are also floating.
Third, pay attention to the timing of subscription and redemption. After subscription, interest usually starts accruing at T+1 (the next day), and it takes some time for funds to arrive after redemption.
Fourth, be aware of quota limits. Some high-yield products have a maximum subscription limit, meaning each user can only buy up to a certain amount. Some also have a total quota limit and are available on a first-come, first-served basis.
Fifth, the earnings from Binance Earn are in cryptocurrency, not fiat currency. Even if you earn interest, if the coin's price falls, your total asset value might still be shrinking.
Frequently Asked Questions
Is Binance Earn safe?
The funds in Binance Earn are stored on the Binance platform, so the security depends on the security of the Binance exchange itself. As the world's largest exchange, Binance has security measures like the SAFU fund. However, any centralized platform carries some risk, so it's advisable not to put all your assets on a single platform.
Can Locked Savings be redeemed early?
Some Locked products support early redemption, but you will lose all or part of the interest earned. The specific rules are explained on the product details page, so be sure to read them clearly before subscribing.
Do I need to pay taxes on Earn interest?
This depends on the tax laws in your region. In many countries and regions, cryptocurrency earnings are subject to income tax. It is recommended to consult a professional tax advisor to understand your tax obligations.
Why does the yield rate of Flexible Savings keep changing?
The yield of Flexible Savings is dynamically adjusted based on market supply and demand. When many people deposit and demand is high, the yield may decrease; when there is more borrowing demand in the market, the yield may increase.
Should I deposit all my coins in Earn?
It is not recommended. Leave a portion of your funds in your Spot Wallet to maintain flexibility, especially if you might need to trade at any time or handle emergencies. You can deposit the portion you are sure you won't need in the short term into Locked Savings, and the portion you need flexible access to into Flexible Savings or leave it in your Spot Wallet.