Binance unveils BFUSD token, a reward-bearing margin asset for futures traders to earn extra rewards while trading futures

Key Highlights:

Binance has launched BFUSD, a reward-bearing margin asset designed for futures trading.

This innovative asset allows users to earn passive rewards simply by holding BFUSD in their futures account or by trading futures with it.

Here are some key features of BFUSD:

•  BFUSD: A new reward-bearing asset exclusively on Binance, offering flexibility and daily USDT rewards for futures trading.

•  Rewards funded by Binance's delta hedging and Ethereum staking strategies.

•  Passive Income: Users can earn daily passive income by holding BFUSD in their futures account.

•  Boosted APY: Users who trade USD-M Futures while holding BFUSD can enjoy a higher annual percentage yield (APY).

•  Redeemable for USD Stablecoin: BFUSD can be redeemed for USD stablecoin, providing flexibility for users.

•  High Collateral Value Ratio: BFUSD can be used as margin with near 100% collateral value ratio.

•  Daily Rewards: Binance funds BFUSD rewards through delta hedging and staking, with daily distributions in USDT.

•  Backed by a $1 million Reserve Fund to protect against negative funding rates.

On November 25, 2024, Binance, a leading cryptocurrency exchange, launched BFUSD, an exclusive reward-bearing margin asset uses as a collateral for futures trading.

This innovative offering allows traders to earn daily USDT rewards while boosting returns by using BFUSD as margin for USDⓈ-M Futures.

BFUSD represents a fusion of passive income and trading functionality, enabling users to amplify their capital while receiving regular rewards funded by Binance’s delta hedging and Ethereum staking strategies.

What is BFUSD?

BFUSD is a margin asset for Binance Futures traders. Users can purchase BFUSD with USDT and hold it in their USDⓈ-M Futures wallet to receive daily USDT rewards.

Additionally, trading USDⓈ-M Futures with BFUSD unlocks boosted reward rates.

Key benefits include:

• Daily Rewards: Earn USDT rewards simply by holding BFUSD.
• Flexible Margin: BFUSD can be used as margin in multi-asset mode, enhancing trading flexibility.
• Passive Income: Rewards are funded through delta-neutral hedging strategies and Ethereum staking.

How It Works

BFUSD leverages Binance’s financial strategies:

• Delta Hedging: Offsetting futures and spot positions to minimize market risks while earning funding fees.

• ETH Staking: Using proceeds from BFUSD sales to stake Ethereum and generate additional income.

Rewards are calculated daily based on net income from these activities, with portions allocated to:

• USDT rewards for BFUSD holders and active traders.

• A Reserve Fund to mitigate risks from negative funding rates.

Reserve Fund for Stability

To protect users during volatile market conditions, Binance has established a $1 million Reserve Fund. This fund acts as a safeguard against negative funding rates and ensures the stability of BFUSD as a trading asset.

How to Use BFUSD?

1. Purchase: Convert USDT to BFUSD in the Futures section of Binance.
2. Margin Trading: Use BFUSD as margin for USDⓈ-M Futures.
3. Earn Rewards: Qualify for daily USDT rewards at base or boosted rates.
4. Redemption: Redeem BFUSD for USD stablecoins when needed.

Risk Considerations

While BFUSD offers numerous benefits, users should be aware of potential risks:

• Market Fluctuations: Negative funding rates may reduce rewards temporarily.
• Binance Credit Risk: Redemption of BFUSD depends on Binance’s operational stability.
• Variable Fees: Fees for purchasing and redeeming BFUSD are subject to change.

Final Thoughts
BFUSD is an innovative tool for futures traders on Binance, combining margin flexibility with a passive income stream.

For more information head over to:

• Introducing BFUSD: Binance’s Exclusive Reward-Bearing Margin Asset for Futures Traders
• What Is BFUSD and How to Use It as Margin in Futures Trading
• How to Buy BFUSD and Redeem for USD Stablecoin
• How are the Reward Rates for BFUSD Holders determined