Binance CEO on Staking, Futures, Venus, Lending, BNB Price, and Euro Stablecoins

On Wednesday (August 28), Changpeng Zhao (aka "CZ"), Co-Founder and CEO of Binance, answered questions on a wide range of Binance-related topics in a Periscope "Ask Me Anything" (AMA) session; in this article, we focus on the main highlights of this AMA.

Staking Support 

Binance currently supports staking for NEO (GAS), Ontology (ONG), VeChain (VTHO), Tron (BTT),  Stellar (XLM), Komodo (KMD), Algorand (ALGO), Qtum (QTUM), and Startis (STRAT).

CZ believes this will be considered "a necessary feature" for exchanges in the future, and that it does not make sense for the users of a centralized exchange to use third-party staking providers.

Binance's Upcoming Futures Platform 

Binance has invested in two futures platforms: one they bought and one they built themselves (with some outside help). CZ says "both of them are kind of ready," and that Binance is trying to decide which one to release. However, it is possible that Binance will release both since "they are slightly different products." CZ also says that "both products are very competitive in terms of features."

Project "Venus"

This is an initiative that was announced on August 19. This is how the Chinese version of Binance's announcement explained the motivations behind this project:

  • "in the past, the company has actively communicated with the regulatory authorities in many countries and regions around the world to establish a global, multi-dimensional customer network and compliance system";
  • "as the world's top blockchain enterprise, the company has already reserved the public chain technology and cross-border payment system for safe operation of new stable coins"; and
  • Binance hopes "to realize an ideal, that is, to break the financial hegemony, reshape the world financial system, let the late-developing countries grasp more financial initiative, safeguard their financial security, and improve the efficiency of cooperation between the state and the country and between people."

CZ says its main goal is to increase adoption of cryptocurrencies, especially fiat-backed stablecoins. Binance is looking for partners (i.e. people who want to issue fiat-backed stablecoins on Binance Chain) to join them.

Binance's Recently-Launched Lending Platform

Binance's new lending platform, Binance Lending, was announced on Monday (August 26) and launched on Wednesday (August 28).

Although initially, you can earn 15% for lending out your BNB, it should be noted that this interest rate is guaranteed only for a short term (two weeks). The same thing applies to the interest rates offered for the other supported cryptocurrencies.

Binance Lending Table - August 2019.jpg

These rates will periodically get adjusted based on supply and demand dynamics. The funds you allocate to Binance Lending are covered by the Secure Asset Fund for Users (SAFU) program (since all crypto on Binance.com is covered by SAFU), and if that is not large enough to cover any losses, then Binance will cover them out of its own private funds ("at the end of the day, if the SAFU cannot cover, we will cover it").

Binance Chain and Binance DEX

CZ talked about three topics in this area:

  • Regarding smart contract support for Binance Chain, although internally there are some disussions going on, as far as CZ knows, no development effort has actually started yet.
  • You can trade direct on Binance DEX through the 30 or so wallets that support it, e.g. Trust Wallet.
  • Binance plans to open source Binance Chain and Binance DEX in the future. Binance knows that many centralized exchanges would like to offer their own DEX, but wants to encourage more innovation by forcing those exchanges to experiment with their own solutions rather than using a fork of what Binance has done.

BNB's Recent Price Action

CZ is, of course, aware that the price of Binance Coin (BNB) has recently gone down (of course, it needs to be said the whole of the crypto market has been in a bearish mood in the past few days).

All that Binance can do is continue working hard ("most of our teams are working 16-hour days, myself included") on increasing adoption of BNB. CZ says they have one of the most hard-working teams in the industry.

Binance Merchandize

Binance does not want to open an online store for selling Binance-branded merchandize, despite the huge demand from Binance users/fans, mostly because they don't know how to handle the logistics. They especially want the Binance hoodie to continue to be "a bit more exclusive."

Euro-Collateralized Stablecoins

Binance would like to issue a euro-backed stablecoin one day in the future (no concerete plans yet) because there is demand for it. However, according to CZ, this is not as easy as it sounds due to the fact that the euro is a negative interest rate fiat currency, and so redemption is a tricky issue.

Featured interest rate table (for Binance Lending) courtesy of Binance

Ethereum's Top DEX Announces Update Powered by ‘Unbounded’ Scaling Solution

IDEX, the top decentralized cryptocurrency exchange for trading ERC-20 tokens on the Ethereum blockchain, has announced a new update powered by an ‘unbounded’ scaling solution called Optimized Optimistic Rollup (O2R).

The scaling solution is made possible by the upcoming Istanbul hard fork, which is expected to take place over the weekend, and brings six Ethereum Improvement Proposals (EIPs). One of these is EIP 2028, which reduces the gas fee for requesting call data from 68 gas per byte to 16 gas per byte. Calldata, CoinDesk reports, is information broadcast on the ETH state necessary for creating specific smart contracts.

These include smart contracts to bundle on-chain transaction off-chain. Aurora Labs, the company behind IDEX, sees Istanbul as a potential way to lower operating costs while processing more transactions. Alex Wearn, IDEX’s co-founder and CEO, said in a press release:

We designed O2R as a way to solve for Ethereum’s scaling challenges today by offering an alternative system that gives businesses a platform to scale to their needs. For IDEX, this 2.0 release gives traders what they want most—the performance and scalability of a centralized platform combined with the security of a DEX

The release notes each settlement transaction processed using the Optimized Optimistic Rollup solution will consume less gas than a single transaction on the IDEX 1.0 exchange, allowing for significant savings on gas fees. A demo version of the IDEX 2.0 trading platform is now available for traders, and comes with a trading competition that the exchange claims will be distributing over $200,000 in prizes.

It’s worth noting that according to Etherscan data, IDEX was responsible for nearly 28% of all transactions conducted on decentralized exchanges on the Ethereum blockchain over the last 30-day period. Uniswap came in first place with 28.9% of transactions, with Kyber Network coming in third with 17%

Decentralized Exchanges

Decentralized trading platforms are a growing trend in the cryptocurrency space. While the first prominent decentralized exchanges were on the Ethereum blockchain, there are now some available on various blockchains, allowing users to trade directly from their wallets.

Allowing users to trade directly from their wallets means there won’t be a risk of losing funds if a centralized platform gets hacked. This has long attracted users, so much so even decentralized exchanges have launched decentralized trading platforms.

These include controversial South Korean trading platform Bithumb, and its Bithumb DEX, popular exchange Binance and its DEX, Poloniex and its TRON-focused DEX launched shortly after it spun out of Circle, and platforms like Waves, which is partly known for its DEX.

As CryptoGlobe reported, OKEx has also announced that the development of its own blockchain, OKChain, is in its final testing phase. OKChain is going to be used to support the unbanked by “providing them basic financial services.” The first decentralized application on the network will be a decentralized trading platform, OKDEX.

OKB, OKEx’s native token, is set to be equipped with more use cases in different fields, including cybersecurity, finance, lifestyle services, and more.

Featured image via Pixabay.