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Avoid Binance ETH/BETH Liquid Pool - here's why

Binance

Cryptocoins Exchanges / Binance 253 Views

As an experiment, I took .1 ETH and put into two different interest bearing instruments on Binance.

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Method 1: Convert .05 ETH to BETH, which of course earns interest just by virtue of you holding it in your spot account. This was converted to 0.05249329 BETH.

Method 2: Add .05 ETH into the ETH/BETH Liquidity Pool, this was converted to 0.0249 ETH + 0.0262 BETH.
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After 1 week, method 1 has resulted in my having 0.05255028 BETH in my account. Meanwhile, method 2 would produce 0.0524 BETH if I redeemed it and 0.0001 BNB in rewards (so with conversion of BNB into ETH that would be 0.05241416 BETH). I know there's slippage and trading fees associated with Liquid Pool, but that's also true for ETH/BETH exchange. I figured the two methods would yield similar results, but the liquidity pool was significantly worse in the end. If you want to earn interesest on your ETH, best to convert it to BETH, hold it there, then convert it back to ETH rather than using Liquidity Pool.

submitted by /u/poli_trial
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