What is Binance Dual Investment
Binance
2020-11-27 05:34
Tutorial Video

What is Binance Dual Investment?

Binance Dual Investment lets you deposit a cryptocurrency (e.g. BTC) and earn yield based on two assets (e.g. BTC or BUSD). Dual Investment is a finance product with high risk and floating interest. The annual yield is fixed, but the final settlement will be influenced by the settlement price and strike price. The dual investment risk lies in the high volatility of the markets. Please make sure that you fully understand the product and the risks before investing.

How to subscribe to Binance Dual Investment?

1. Log into your Binance account and click [Finance] - [Binance Pool].
2. Click [Dual Investment]. Here you will find different products with different underlying assets, such as BTC, BUSD, and USDT.
Each product has a different annualized rate of return, delivery date, and strike price. When the product you subscribe expires, the respective crypto will be added to your Spot Wallet within 48 hours.
*Please note that Dual Investment cannot be redeemed early.

How does Dual Investment work?

For example, Bob invested 1 BTC on Binance Dual Investment. The BTC price was $10,000, and he subscribed to a 30-day product with a 40% annual yield. The strike price was set to $12,000.
When the product expires 30 days later, Bob will get one of the two outcomes:
Scenario 1: BTC is above $12,000
  • Bob gets the value of his 1 BTC back in BUSD, plus the interest.
    • (12,000 * 0.40) / 365 * 30 = 394.5 BUSD
    • Total received: 12,000 + 394.5 = 12,394.5 BUSD
Scenario 2: BTC is below $12,000
  • Bob gets his 1 BTC back, plus the 40% annual yield.
    • (1 * 0.40) / 365 * 30 = 0.03288 BTC
    • Total received: 1.03288 BTC

Glossary:

  • Expiry date: This is when you can redeem your crypto with the interest that you earned.
  • Strike price: The price threshold that determines which settlement currency you’ll get paid in.
  • Settlement price: The price of your crypto on the expiry date. It’s calculated using an index that comprises some BTC-USD spot market pairs with the highest liquidity.
  • Rate of return: The fixed interest you’ll earn when the product settles.
  • The annualized rate of return: The interest you’d earn if you lock your crypto in a Dual Investment product for a year. For example, if the annualized rate of return is 365%, then your estimated daily return is 1%.