Information about Binance wallet's financial activity that you must know


1. What is this event really about?

In simple terms, it's 'deposit money to earn interest':



You exchange USDT for USDD (another stablecoin, basically equal to 1 US dollar).
Then mortgage the USDD on the platform (turn it into sUSDD).
The platform will pay you interest, currently the annualized rate during the event is 14.31% (which seems very high).

2. Why is it not recommended to participate if there is no ETH chain USDT?

An annualized rate of 14.31% sounds impressive, but this event only allows deposits for 28 days, the actual return is:
14.31% ÷ 12 months × 28 days ≈ 1.1% (which means if you deposit 1000 dollars, you only earn about 11 dollars in 28 days).


If your USDT is not on the ETH chain, you need to cross-chain swap it first, the fee for one swap is about 0.7%, so round trip is 1.4%.
1.4% > 1.1%, the fees are higher than the interest, making it a waste of effort, plus you end up losing money.


Three, why is it not worthwhile to deposit over $500?

28 days yield 1.1%, $500 can earn $5.5.


But this activity is all on the Ethereum chain (the so-called 'noble chain'), and each operation requires gas fees (transaction fees), which are usually over $1 now.


Participating in the activity requires about 4 operations (swapping coins, authorization, collateralization, and finally redeeming), with gas fees totaling at least $5.
Earn $5.5, pay $5 in gas, basically not making any profit.
If you deposit less (like $100-$300), you'll directly lose on gas fees, resulting in a pure loss.


So: at least over $500 + already having USDT on the ETH chain is truly worthwhile.


Four, is this USDD safe?

In short: 99.99% is safe, there is basically no risk of a collapse.


If you meet the above conditions (having USDT on the ETH chain + depositing over $500), the yield is significantly higher than regular financial products, and after the event ends, the basic annualized rate is still around 12%, which is quite attractive.


For those who want to understand the '0.001% risk', let me briefly explain the background (just consider it a story):


There are two types of stablecoins:



USDT, USDC, etc.: backed by real money reserves of US dollars, can be exchanged 1:1 for dollars at any time.
USDD, etc.: algorithmic stablecoins, using other crypto assets (mainly USDT, TRX, BTC, etc.) as collateral, the project guarantees you can exchange back for $1 at any time.

USDD was created by Sun Yuchen (Sun Cut) in 2022, and it mainly reserves mainstream assets like USDT, with a reserve ratio of over 230% (that is, the collateral is more than 2.3 times the issued coins), so even if the market crashes, it can withstand it.


Historically:



During the LUNA collapse in 2022, everyone was most afraid of algorithmic stablecoins, USDD only dropped to $0.93 at its lowest, and quickly returned to $1.
Later, during several major drops (like the day BTC dropped 20%), USDD also steadily maintained $1.

So under normal circumstances, it's almost impossible to have problems.
But if you've been scammed by some DeFi projects before and are completely scared, then don't touch it, just watch from the sidelines for the safest option.


In summary:

For those with USDT on the ETH chain + willing to deposit over $500 + not afraid of DeFi: it's worth participating, the returns are good.
In other situations: it's recommended to pass for now, to avoid fees eating into your profits.


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I wish everyone a happy experience and steady profits!

  • No USDT on the Ethereum chain (ETH chain)? Don't participate, as cross-chain fees will consume all your earnings.


  • Not planning to deposit over $500 (500U)? Don't participate, as the gas fees are higher than the interest, which means you're just wasting effort.


  • Afraid of USDD (like the previous experience where mevUSDT couldn't be withdrawn)? Then don't touch it, just watch from the sidelines.

For those looking for stable profits, I recently opened a copy trading feature, welcome to follow along for peace of mind.