Binance Earn Unveils ‘Discount Buy’: A New Way to Buy Crypto or Earn Rewards
John: Hey everyone, and welcome back to the blog! Today, we’re diving into a new feature from one of the biggest players in the crypto space. Binance recently rolled out a product on its Binance Earn platform called ‘Discount Buy’. It’s designed to give users a new way to interact with the market.
Lila: Hi John! Okay, ‘Discount Buy’ sounds interesting just from the name. In simple terms, what is it?
John: Great question, Lila. Think of it as a tool that helps you do one of two things: either buy a cryptocurrency like Bitcoin at a price that is lower than the current market price, or earn rewards on your stablecoins if the purchase doesn’t happen. It automates a specific strategy that many traders use.
What Exactly is ‘Discount Buy’?
Lila: You mentioned it’s on Binance Earn. Is it a completely new thing, or is it part of something else?
John: That’s a key point. It’s actually a new user-friendly mode for an existing product called Dual Investment. Binance has essentially created a simplified interface that focuses on one of the two main strategies of Dual Investment: the “Buy Low” strategy.
Lila: Wait, back up a little. What’s Dual Investment?
John: Of course. Dual Investment is a structured product that lets you deposit a cryptocurrency and earn yield. It has two main types: “Buy Low” and “Sell High”. The ‘Discount Buy’ feature is just a dedicated and simplified way to use the “Buy Low” option. It strips away some of the complexity to make it more accessible.
How It Works: The Two Possible Outcomes
Lila: Okay, that makes sense. So if I wanted to use ‘Discount Buy’, what would I do? And what happens next?
John: It’s a pretty straightforward process. You start with a stablecoin, like USDT or FDUSD. Then, you choose a crypto you want to buy, like Bitcoin (BTC) or Ethereum (ETH). You then decide on two things:
- Target Price: This is the price at which you are willing to buy the crypto. It has to be below the current market price.
- Settlement Date: This is the future date when the system will check the price and settle your subscription.
John: Once you subscribe, your stablecoins are locked in until that Settlement Date. On that date, one of two things will happen.
Lila: I’m listening! What are the two outcomes?
John: This is the core of the product. Here are the two scenarios:
- Scenario 1: Price is ABOVE your Target Price. If, on the Settlement Date, the market price of the crypto is at or higher than your Target Price, your purchase order does not go through. Instead, you get your original stablecoins back, plus you earn rewards in that same stablecoin.
- Scenario 2: Price is BELOW your Target Price. If the market price is lower than your Target Price, the deal is on! Your stablecoins are used to buy the crypto at your pre-set Target Price. And on top of that, you still get your rewards, but this time they are paid in the cryptocurrency you just bought.
Lila: So, you either get to buy the crypto you wanted at a discount, or you get your money back with some extra earnings on top. That sounds like a win-win situation.
John: That’s the appeal of the product. It offers a clear outcome in either direction. However, as with any financial product, it’s essential to understand the specific risks and mechanics involved before jumping in.
Let’s Walk Through an Example
Lila: Can we use an example? Say I want to buy Bitcoin.
John: Perfect. Let’s imagine the price of Bitcoin is currently $65,000. You believe it might dip, and you’d be happy to buy it at $60,000. Using ‘Discount Buy’, you could:
- Commit 6,000 USDT (a stablecoin).
- Set a Target Price of $60,000 for BTC.
- Choose a Settlement Date, say, 14 days from now.
- Let’s assume the product shows a 15% APR (Annual Percentage Rate) for these terms.
John: Now, we wait 14 days for the Settlement Date. Here’s what could happen:
John: Outcome A: If the BTC price on that date is $60,000 or higher (e.g., $62,000), you don’t buy BTC. You get your 6,000 USDT back, plus the rewards calculated from the 15% APR, paid in USDT.
John: Outcome B: If the BTC price is below $60,000 (e.g., $59,000), your 6,000 USDT is used to buy BTC at your target of $60,000. You would receive 0.1 BTC. You would also receive your reward, paid in BTC.
Lila: That makes it very clear! But you mentioned risks. What happens in Outcome B if the price drops all the way to, say, $55,000? I’d still be buying at $60,000, right?
John: Exactly, and that’s the most important risk to understand. You’ve hit on the key trade-off. In that case, you are obligated to buy at your $60,000 Target Price, even though the market price is now lower at $55,000. This is known as market risk. The other factor is opportunity cost—your funds are locked, so you can’t use them for other opportunities that might arise before the settlement date.
Key Things to Remember
Lila: That’s a really important distinction. So, it’s for people who are genuinely happy with their target price. Are there any other details I should know?
John: Yes, a few key points directly from Binance’s announcements:
- No Trading Fees: Binance states that there are zero trading fees associated with this product. The returns you see are what you get.
- Locked Funds: Once you subscribe, your funds are locked in. You cannot cancel or redeem your subscription before the Settlement Date.
- Variable APR: The APR is not fixed across the board. It changes based on the asset, the Target Price you select, and how far away the Settlement Date is. The APR is locked in for you at the moment you subscribe.
- Supported Assets: It launched with support for popular assets like BTC, ETH, and BNB, which can be bought with stablecoins like USDT and FDUSD. It’s always a good idea to check the platform for the most current list.
John: Ultimately, ‘Discount Buy’ is a tool that formalizes a common crypto accumulation strategy—setting “buy-the-dip” orders—while adding a yield component. It provides a structured way for users to either put their stablecoins to work earning interest or to acquire more crypto at a predetermined price point they are comfortable with.
Lila: Thanks, John! It’s much clearer now. It feels like a tool for patient people who have a clear plan for what they want to buy and at what price.
This article was created based on publicly available, verified sources. This content is for informational purposes only and should not be construed as financial advice. References:
- Binance Announcement: Introducing Discount Buy
- Binance Blog: A Guide to Buying Crypto at a Discount
- Binance Dual Investment Product Page