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Binance Now Enters Crypto Lending

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Satoshi&Co Daily Crypto Newsletter

August 26 · Issue #226 · View online
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Check out past issues of the newsletter along with more interesting crypto content as well as short (but great) conversations with leading crypto industry participants at our newly-launched website

Crypto lending is a fast-growing corner of the crypto world, and DeFi efforts around crypto lending have been picking up steam, as we periodically cover in our Friday DeFi watch series. We had recently covered some interesting developments in this space around tokenizing interest here. It is also worth revisiting an earlier piece on crypto lending rates, which are highly volatile, compared to their traditional finance peers
Crypto exchange behemoth Binance today announced its foray into the fast-growing crypto lending business. Binance users can earn interest on their cryptocurrency deposits with BNB, ETC and USDT being the first ones to go live on the platform. Binance is clearly expanding the suite of its product offerings with the launch of margin trading followed by the lending business. This new initiative could be used to channel more liquidity into the borrowing business in which Binance lends funds for users to trade on margin. While the interest rate differential for ETC and USDT seems reasonable at 0.3% and 0.0375%, the figure for BNB stands astronomically high at 94.5% due to the significantly high borrowing rate of 0.3% daily interest rate (109.5% annualized). 
Combined with its recent foray into stablecoins through a stablecoin platform that could potentially permit any corporation or entity (or even any Govt) to launch its own stablecoin, as well as its recent DEX efforts, Binance truly is reaping the virtuous cycle benefits of being an end-to-end behemoth in the heart of the crypto scene in Asia, where it is also relatively unfettered by regulations, unlike some of its counterparts in the US such as Coinbase or Circle. It remains to be seen how ‘traditional’ DeFi giants such as Compound and DAI react to Binance’s entry into this fast-growing market. We are in the very early stages of DeFi, and some incredibly compelling, hitherto unimaginable use-cases should soon emerge in this space. Keep watching closely.
Source: Satoshi&Co Research
Source: Satoshi&Co Research
Meanwhile in Crypto Wonderland....
“Makara Pulls The Plug on tZERO”
After a long courtship, Overstock’s security token platform, tZERO, has lost another potential investor. “Makara will not be investing in tZERO right now,” Interim CEO Jonathan Johnson said during the Overstock investor call on Monday. Johnson did mention that the Singapore-based fund will keep an eye on tZERO and possibly reconsider its decision in the future. It was Johnson’s first investor call since taking the helm of the e-commerce company last week. Overstock founder Patrick Byrne abruptly resigned from the company on Aug. 22 following an earlier admission of a romantic relationship with Maria Butina, the Russian spy currently serving 18 months in federal prison. As for Makara, the fund’s departure appears to be the final nail in the coffin for a much-touted investment that considerably dwindled in size over the course of 2019.
“US Authorities Nab A Crypto Scamster”
The United States authorities indicted a 25-year-old man last Friday for exchanging $25 million in cash and crypto obtained from illegal activities using his unlicensed money transmitting business. The court documents detailed that Kalra operated a virtual currency exchange in the US without obtaining any permission from the authorities from May 2015 to October 2017. He exchanged fiat currencies into Bitcoin and vice versa and only dealt with high-volume clients who were willing to pay a fee of at least $5,000.
“Ethereum Foundation Announces Grants For ETH 2.0 Researchers”
The Ethereum Foundation has unveiled a new round of funding for the development of Serenity or ETH2.0, which will bring Proof-of-Stake, sharding, and other scaling solutions to Ethereum. According to a blog post from the foundation, in recent months, it, along with Protocol Labs and ConsenSys, has “granted substantial awards to leading client development teams currently tasked with delivering long-standing multi-client testnets as development approaches the launch of Phase 0.”
“Waves DEX To Support ERC20 Token Trading”
Blockchain platform Waves has added support for Ethereum-based (ETH) ERC-20 compliant tokens to its decentralized exchange (DEX). The platform announced the new feature on Aug. 22, and hopes it will have a positive impact on the crypto community. Recently, the Waves team also launched a new gateway with support for Vostok and Ergo tokens.
Crypto Twitter Pick
Daniel Lacalle
In the past decade, the #Argentina peso has lost 98% of its value vs the USD, the #Turkey lira close to 90%.

"Printing money for the people" the recipe for disaster.
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