BNB Vault: Why is it so important for Binance?
By: Ruma Das
Tags: Binance Smart Chain, Binance, Bellaprotocol, Bnb, Binance Launchpad

Read my original article at Voice.

The most important use case of BNB initially had been the discount on transaction fees. However, the role of BNB has much evolved since then. BNB has been used for

• Holding a certain amount of BNB is mandatory to get tickets to participate in Binance Launchpad.

• Binance Smart Chain (BSC) fees are paid in BNB

• DeFi staking and flexible staking benefits

• Binance Launchpool tokens are given for free to BNB stakers

So, why BNB Vault, as a product, is so important?

Binance has been rapidly building new features. However, it became extremely confusing for users to use them. Below are some examples:

1. A user staking a Token in Certik Launchpool will not get a reward from Hard Protocol Launchpool (Users have the option to split tokens but no Dual Rewards in Launchpool)

2. A user putting BNB on DeFi staking will not receive Launchpool rewards

BNB Vault solves this problem. It is a reward aggregator for multiple Binance products.

BNB Vault Use Case

BNB Vault is a BNB yield aggregator. It will combine both centralized and decentralized finance in just one click, allowing BNB holders to enjoy the best APY returns. BNB Vault guarantees capital to the stakers. Products which are integrated include:

• Launchpool

• Flexible Savings

• DeFi Staking

Some important points to be noted are:

• One-click staking

• Interest calculation will start from 0:00 AM (UTC) on Day 2 of staking. The income will be paid on Day 3. Income is distributed to staker’s spot accounts daily

• Flexible unstaking (anytime)

• Staked BNB Vault assets will be eligible for benefits like airdrop, Launchpad holding position, VIP rights, etc.

• The current estimated APY is between 5% and 8%. This is a flexible APY and is adjusted according to the actual benefits and risk level of BNB Flexible Savings, DeFi Staking, Launchpool, and future potential Earn products.

Launchpool

Binance Launchpool is a huge hit and it has helped to keep the price of BNB steady in a turbulent market. It started with the launch of Bella Protocol (BEL). Since then there have been 7 tokens launched in the Launchpool

• Bella Protocol (BEL)

• Wing Protocol (WING)

• Flamingo (FLM)

• Venus (XVS)

• Alpha Finance Lab (ALPHA)

• Certik (CTK)

• Hard Protocol (HARD)

Some important points:

• Launchpool lets users stake BNB and farm (earn) a new token, for free.

• Usually, the time period to earn from each token is 30 days.

• These tokens are listed in Binance.com after the first 7 days of farming.

• Users can trade these tokens anytime they want (after release).

• Users earn tokens proportional to their contribution to the Launchpool.

• Users can add to their staked amount at any time.

It is recommended that you stake a minimum of 50 BNB in the BNB Vault. This is to ensure that you also get tickets for the Binance Launchpad Projects. An average of 50 BNB staked in Launchpool gave rewards of approximately $2 daily in the initial days. This number generally fluctuates considering the quality of the Launchpool token. Currently, 50 BNB is giving around $ 0.5–1.

I usually convert my Launchpool tokens to BNB and stake them. Believe me, it is a huge opportunity!

Flexible Savings

Flexible Saving is the usual Crypto savings account. Users earn interest by subscribing. Different tokens have different APYs. Interest can be redeemed anytime.

However, it may be noted that the APY received for each individual token is much less than what you have received by direct staking in the token’s platform. Binance is actually taking your token, staking on your behalf, and giving you only a tiny fraction of the profit.

DeFi Staking

Binance acts as an enabler to deposit a user’s crypto in DeFi (Decentralized Finance) through smart contracts. Binance obtains and distributes realized earnings and tries to get maximum benefits.

However, it may be noted that users do not hold the private keys and Binance does not hold the liability for any losses incurred due to smart contract failures.

Conclusion

Binance is still a leader among the centralized exchanges. BNB Vault is a product which the users need. It obviously solves the aggregator problem. I believe that Binance understands the nature of blockchain, and is heading in the right direction. Products like BNB Vault will ensure a user’s stickiness to the Binance Platform.

I would appreciate it if you leave your point of view in the comments for further discussions.

Reference: Binance

Read my previous article: The Sandbox: The hugely anticipated Blockchain Metaverse Game

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