Alex Dovbnya
Binance has added four new liquidity pools, expanding its liquidity swap platform
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Binance’s liquidity swap platform has announced the addition of four new liquidity pools: DOGE/BUSD, SHIB/BUSD, LINK/BUSD and LTC/BUSD.
Liquidity pools based on smart contracts refer to two cryptocurrencies that users can switch between. Users can deposit digital tokens into such pools to receive rewards for their activity as liquidity providers. Traders are drawn to liquidity pools as they typically pay lower fees compared to centralized exchanges.
The cryptocurrency giant launched its Automated Market Maker (AMM) liquidity swap platform back in October 2020 in addition to the centralized exchange. The move was prompted by the rapid rise of decentralized exchange Uniswap. In addition to earning some trading fee income, Binance also offers liquidity providers rewards in the form of its native BNB tokens.
Originally USDT/BUSD, USDT/DAI, BUSD/DAI were the only available trading pairs. Binance now offers a wide range of different liquidity pools with bitcoin, stablecoin and altcoin pairs. Risk-taking users can potentially earn double-digit APYs by choosing obscure options from Binance’s “Innovation Pools” category.
Last May, Binance opened DOGE/USDT and DOGE/BTC liquidity pools after the meme cryptocurrency skyrocketed in popularity in early 2021. In June 2021, the exchange also offered a USDT liquidity pool using the SHIB cryptocurrency.
Uniswap remains the world’s leading decentralized token exchange protocol. As reported by U.Today, the total trading volume of the decentralized cryptocurrency exchange exceeded $1 trillion.
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