Binance Dual Investment’s Key Benefits
Binance Dual Investment allows you to deposit a cryptocurrency and receive a return on two assets at the same time. In essence, you commit your crypto assets, lock in a yield, and gain value if the value of your committed assets rises.
Introduction
Dual investment is the ideal option since it has the ability to give you excellent profits. It invests in cryptocurrencies. It entails less risk than other types of investments and can provide a higher level of return.
The Binance Dual Investment allows you to deposit crypto and get a higher income depending on the combination of two assets. By attempting to forecast the direction of the market, you can decide whether to sell your crypto at a higher price or acquire it at a lower price in the future.
Stablecoins such as BUSD or USDT may also be used, but Binance Dual Investment takes this concept to the next level. You have the opportunity to earn a return regardless of the market’s direction.
The currency you will get depends on the outcome of your investment at the time of settlement. If you opt to sell higher, and the market price on the settlement date is greater than your target price, your investment will be sold for the other currency (BUSD) at the target price. Even if the market price does not reach the goal price, you will still earn a return on your crypto deposit.
On Binance, Where Can I Find Dual Investment?
To use Binance Dual Investment, you must first register a Binance account.
If you already have a Binance account, finding Binance Dual Investment is super easy. If you do not already have a Binance account, you must first create one and verify your identity.
Step 1: Select “Dual Investment” from the “Earn” section at the top of your Binance homepage after your account is ready.
Step 2: When the page loads, you’ll see a selection of cryptocurrencies. From there, you may choose whatever product you’d like to subscribe to.
Step 3: Then, enter the amount you want to invest.
Step 4: Finally, select “Subscribe.”
You’ve finished the process. Following the settlement date, your funds will be settled. On the Dual Investment Order page, you may see a list of your prior orders.
Understand The Following Key Concepts
To understand how Binance Dual Investment works, it is necessary to first define some of the product’s key terms
Deposit currency: The asset you’re putting into your Binance Dual Investment account. You can now select from BTC, BUSD, or USDT.
Alternate currency: If the target price is met, you will receive this currency.
Settlement price: On the delivery date, at 08:00 UTC, the current price of the underlying asset. The price of the product is then compared to the strike price to see if it should be exercised.
Strike price: The price that decides whether or not the deposit currency is converted. To decide the outcome, the strike price is compared to the settlement price. If the product is exercised, the strike price is applied as the conversion rate.
Delivery date: The date on which the underlying’s price is compared to the strike price. You will not be able to withdraw your payments prior to the delivery date.
Reference price: The underlying asset’s current price.
Annual Percentage Yield (APY): A certain APY is assigned to each Binance Dual Investment product. Each product’s annual percentage yield (APY) changes over time, but once you subscribe to the product, your particular APY is locked in. It’s important to remember that this statistic is annualized to avoid confusion and false expectations.
Target price: The price threshold that decides which currency you’ll be paid in for settlement. When you buy a Dual Investment product, the price is set at a certain level.
What Are The Benefits Of Using Binance Dual Investment?
Binance Dual Investments is one way to generate a return on your crypto assets, whether they’re bitcoin or stablecoins. Here are a few examples of the product’s fascinating use-cases.
The Binance Dual Investment allows us to easily “lock-in” a lower asset price than the current market price. Let’s imagine you own 1 BTC and it is currently trading at $10,000. You can put your 1 BTC in an Up-and-Exercised Binance Dual Investment product to protect your portfolio against a Bitcoin price decline. Let’s suppose the strike price for this option is $11,000. If the price is $11,000 or less on the delivery date, you will receive 1 BTC plus interest (paid in BTC), making you better off than if you merely kept the 1 BTC in your wallet.
If the price is over $11,000, you’ll get $11,000 plus interest. If the bitcoin is substantially greater than $11,000, though, you’d be better off just keeping 1 bitcoin in your wallet. Even if the Bitcoin price rose to $15,000, you’d only get $11,000 plus interest. Instead of the $11,000 plus the interest you received from Binance Dual Investment, you would have $15,000 worth of BTC in your wallet if you did nothing.
If you have stablecoins and want to acquire bitcoin, the Down-and-Exercised Binance Dual Investment product can let you “lock-in” a larger quantity of bitcoin than you can buy right now. The following is how it works:
Assume you have 10,000 USDT and Bitcoin are presently trading at $10,000. If you used USDT to buy Bitcoin on the spot market, you would receive 1 BTC. Let’s explore what occurs if you invest $10,000 USDT in a Down-and-Exercised Binance Dual Investment product with a strike price of $10,000. If Bitcoin is trading below the strike price on the delivery date, you will get 1 BTC plus interest (paid in BTC), which is more than the 1 BTC you could have purchased with your 10,000 USDT before depositing it into Binance Dual Investment.
If the price of Bitcoin is more than $9,000 at the time of delivery, you’ll get your $10,000 USDT back plus interest (paid in USDT).
Binance: Dual Investment Risks
Everything we do has some level of risk. This applies to both general investments and the Binance Dual Investment. However, unlike many other high-risk schemes, the risk here is low, and your money is not at risk.
Even so, if you decide to try Dual Investment, it’s crucial to know exactly what you’re up against. The risks are as follows:
_There is nothing further you can do after you have subscribed to a plan. It is not possible to cancel or amend it in any manner. Your possessions are illiquid, so you’ll have to wait until the contract expires to get them back.
_When you invest in something, the goal is to get the most benefit possible out of your investment. Most of the time, this means a higher yield or return on your investment. It’s important to remember, though, that while the yield is fixed, and there is no significant risk of your principal missing, the same cannot be stated for the value of the principal after the contract is exercised, because you will be receiving a different currency. The reason for this is that in order to really register your earnings, you must first convert the alternative coins back to the deposit currency. And, depending on when and how this occurs, the re-converted principal might possibly be lower than the original. Even when the yield is included in
_When the markets move in your favour and your option is exercised, remember that the substitute currency you get has lost its value. To put it another way, it may have been more financially sensible to keep the underlying currency at this point. There’s no problem if you don’t mind holding the alternative currency or have intentions of utilizing it right away.
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Conclusion
No matter which way the market moves, Binance Dual Investment allows you to make passive income. You may monetize your market view and try to hedge market-beating prices with increased interest if you’re an investor or trader who wants to do more with your HODLed coins than just stake or lend them.
