Binance is giving 1 5-25% APR in real time on USDT with no limits on earn account, how safe is it?

Binance is giving 15-25% APR in real time on USDT with no limits on earn account + an extra 5% on the first $500, how safe is it?

I've not seen anyone talk about this, and I found it extremely suspicious…

In the last months it has been fluctuating in the 10-15% range. Right now is more on the 20-25% side.

How secure and long term this is?

Is this a Binance thing or is this a Tether thing? Which one is going to explode? /s

On USDC is 8.8%, so muuuuch less than USDT, and another example is USDC on coinbase giving 5.10% APY, which sounds more realistic than this.

I don't know if this is a bull market thing or if they're just chasing people, but a year ago was 3-7% if I remember correctly… here is the APR fluctuating in the last 24h.

39 thoughts on “Binance is giving 1 5-25% APR in real time on USDT with no limits on earn account, how safe is it?”

  1. It’s fluctuating for sure.. probably they can afford to do this for a while but it will surely drop. i wouldn’t expect USDT to crash though, that would be terrifying 🙂 Still you get better rates than at the bank so I’d keep some money on there..

  2. It’s currently at 45% on kucoin.

    In summary, it just means that people are doing lots of short term loans thinking that BTC is going to continue going up. It’s pretty safe.

  3. I’m assuming it’s because the lending rates on DeFi like Aave are through the roof since folks are pulling stables.

  4. It is cash used for margin trading. Bitcoin is skyrocketing and degens are going to want to degen with 2x, 5x, 10x, 50x leverage and lose their money.

    For someone to have a leveraged position requires someone else putting up the cash. Binance is paying you for that cash so they can charge 30%+ margin rates on morons using leverage. If you trust Binance to liquidate idiots in time such that they don’t take any loses on your cash then it is “safe”. The major risk here beyond the normal not your keys not your crypto is something happens and Binance can’t liquidate in time and suffers losses beyond the user’s balance and then becomes insolvent and tries to stick the losses to depositors. If Binance can always liquidate every degen moron so only the degen moron and nobody else suffers a loss the system works. If they can’t …

    Note: USDC is a much lower rate because most of the volume is on the USDT pairs not the USDC pairs. For some reason every degen gambler wants to lose all their money using USDT not any other stablecoin or even USD. I get the USDT pair has the highest volume/liquidity but they are paying a fortune in higher interest rates for that.

  5. I would not – I parked all my savings/profits/BTC into Celsius only to get fkd royally – I had to borrow money to pay taxes on money that I did not have access to..

    not saying Binance will be that…but personally – I would not lose principal chasing these unreal APYs. Again, this is my view…not necessarily universal.

  6. It could go down to 5% or 3% within a week, depends on how bullish people are. The good thing is that the interest is based on supply and demand, not on the central banks and the government. If people are bullish they take out loans for leveraged (margin) trading. I usually buy low and sell high, and move the sold profits into the USDT earn account to get a few more % on top without the risk. I move the funds into buying alts again, when the prices and interest rates drop. You get a share of their wrong decisions, loan-backed-FOMO. You can compare the rates with the ones you’d have to pay to take a loan for trading at binance + safety margin (margin call). See Finances > Loans. If you take a flexible rate and want to loan $1,000 USDT backed by BNB (you’d have to lock in), you’d pay around 45% at the moment. If you expect a 100% return for your BTC investment in 3-4 weeks, it’s worth doing. It’s called gearing (increasing the ROI by taking out loans). If it goes down. It’s my or the other people’s profit.

    It’s the safest investment, but interest rates may fluctuate quickly. and you may not be able to get back all your funds immediately. so be prepared to wait hours or days for the money. often people taking out loans are broke after a wrong investment decision, then it takes a while until their collateral has been sold and made available for you to withdraw, especially if a crash happens and all positions are being liquidated and all want their savings back. it’s also possible that during a heavy crash, the value of their collateral is lower than their debt. in such case you cannot withdraw all your funds, because there is no backing left, you’d be paid with new people taking loans, or when binance gets the money from the debtor.

    People have different strategies and risk assessments.

  7. I wouldn’t touch it with a 10 feet pole. USDT in general, I would not touch it.

  8. Personal opinion… FTX caused the last major crash in 2021, Binance is going to cause the next one in mid to late 2024…

  9. After what Celsius did to me and my BTC, I’m hesitant to trust ANY kind of passive income in crypto, especially ones that seem too good to be true. Staking is one thing, but lending? I’m not going near lending again.

  10. i have some usdt earning yield there, i imagine they can pay it because people are borrowing at higher rates from them.

  11. It’s a good indicator that the market is over leveraged on the upside. Expect a sudden drop in btc price in the next weeks to weed out all the degen margin trading.

    Nothing too suspicious here.l by my book.

  12. There’s nothing suspicious.

    The percentage is dynamic. Usually it is in one digit, but since everyone is going crazy and taking loans, the demand is high and the rewards will be high too.

    It will go down once the hype dies out.

    If you took profits and have a bunch of usdt, it’s a nice way of doing some passive income

  13. It’s safe, if anything they don’t pay you enough. Binance is currently charging ~60% interest on borrowed USDT and only gives 25% APR to the people staking. The amount is dynamically adjusted, they were paying less than 1% APR during the bear market when no degens were borrowing USDT to leverage.

  14. It’s extremely unsafe because ask yourself: where is that money coming from?

    The answer is: Binance are degens themselves and invested heavily into this bullrun (using your money), waiting to be rekt by a correction (FTX 2.0).

  15. It’s not. It’s centralized and if it means profits you will be screwed. Look at Celsius, Gemini, BlockFi. All got greedy and screwed over their clients.

  16. FTX had 8% on everything. I would be cautious regardless if it’s due to leverage pressure.

  17. These rates are not fixed, they can change at any time.. given that, I suppose they need liquidity for leverage trading accounts

  18. The APR adjusts up or down based on demand. You might see 5-25÷ for a hot minute. Tomorrow, it might be 1-3÷.

  19. Prices go up, sell and lend usdt. Prices go down, buy. Doing that since november and got 220% profit so far.

  20. not safe, huge risk of default. margin calls in crypto are definitely not an exact science. hence why the high interest. big risk = big reward.

  21. Even USDC is high. If this was any financial institution outside of crypto I would say that they are insolent and it’s a last resort to stay afloat but what do I know.

  22. People are comparing this to celsius, but there are 2 differences.

    1. We are talking about binance, by far the biggest exchange. If they go bankrupt the whole market will crash enormously.

    2. We are currently in a bull market. Pretty much the best time for the exchanges. They are making huge profits and there own savings in crypto are pumping as well. So it is less likely to see a bankruptcy during this time.

    Ofc there is still a risk, but what I want to say is that it is less likely than before.

  23. Anybody remembers Voyage USDC disaster? They gave 9% on USDC unlimited amount. And then……

    I’m happy with my gain already, and don’t plan to earn every penny.

  24. Its fine. There is a rush in margin demande who pays more then the yield they give you.

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