Binance has launched a Uniswap competitor, called Binance Liquid Swap

Binance has launched a “centralized” automated market maker (AMM) pool for liquidity providers, called Binance Liquid Swap.

Users of Binance can quickly complete an exchange between two tokens in the Swap Pool, or become a liquidity provider by adding funds into the Liquidity Pool to earn fees from trades in the Swap Pool and also savings interest income.

The AMM will use a pricing module instead of an order book to provide more stable prices and lower transaction according to the announcement. The company is prioritizing liquidity for its own tokens so the first pools offered on launch will be USDT/BUSD, BUSD/DAI and USDT/DAI.

Binance Liquid Swap Advantages:
  • High Returns – Add funds to the liquidity pool to receive returns such as trading fees and savings interest.
  • Low Slippage – Trade in the Swap Pool for better pricing and low slippage, depending on the size of each liquidity pool.
  • Competitive Fees – During the promotion period of 2020/09/04 – 2020/10/04, all trades will enjoy a very low fee of 0.04%. Trading fees will return to 0.1% after the promotion ends on 2020/10/04.

Uniswap, the leading decentralized exchange (DEX) by trading volumes, follows the AMM model and distributes all of the collected trading fees (0.30%) as rewards to liquidity providers in any pool.

It’s the first AMM pool product on a centralized exchange and will be integrated into the exchange, allowing users to pool tokens in their wallets to earn rewards.

Earnings will be accrued with a corresponding 7-day annual percentage yield (APY) with returns converted into the assets in the respective pools. Transaction fees and prices will be determined by the number of assets in the liquidity pools.

Binance CEO, Changpeng Zhao, stated the new products aimed to attract more volume and participants:

“We hope to further the growth of the DeFi marketplace and empower our users with more earning power and easier liquidity through a centralized AMM pool with the credibility, safety and security provided by Binance”.

On September 1, the crypto exchange took aim at Ethereum with the launch of ‘Binance Smart Chain’, a new Ethereum smart contract compatible blockchain interoperable with the existing Binance Chain.

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