Author: Azuma, Odaily Planet Daily
Today, news about 'Coinbase updates derivatives rules, providing tiered subsidies for USDC used as collateral in contracts, with maximum annualized subsidies reaching 12%' has sparked widespread discussion in the community.
In the Chinese community, KOL benmo.eth was the first to disclose this update on X, stating: 'This product directly competes with funding fee products like BFUSD and USDE. In the current low-fee environment, the rewards have already turned negative. For example, if you have a margin of 1 million USDC and open a long position of 2 million in BTC, then your margin of 1 million USDC naturally carries an annualized return of 8%; if your margin is 10 million USDC and you open a contract worth 20 million, then your 10 million USDC will receive an annualized return of 12%. In the increasingly fierce competition in derivatives, Circle and Coinbase are directly subsidizing cash for the larger market, with the former aiming for USDC in the derivatives market. This move has significant strategic implications and has further drawn the entire funding fee market into a bloody battlefield.'
Allowing the collateral assets in contract positions to automatically earn interest was first innovated by Backpack, which supported 'interest-bearing contract trading' and 'automatic lending' functions when it launched public testing in January this year.
As for the BFUSD mentioned by benmo.eth, it is a reward margin asset launched by Binance specifically for contract users. Users can continuously earn returns just by holding BFUSD, while also using this stablecoin as margin for their contract accounts, achieving a model of 'earning while using'. As shown in the picture below, although the current basic annualized rate of BFUSD is 'only' 5.82%, historical data shows it has frequently exceeded 10%.
Coincidentally, OKX has also recently launched a similar function that breaks down the barriers between trading and wealth management, and its model is even more aggressive—covering not only contracts but also spot trading.
On August 15, OKX announced it will launch the 'automated coin earning for trading accounts' feature for VIP users. This feature helps users automatically lend assets in their trading accounts to earn returns without affecting the assets' use as collateral and trading margin. Most importantly, assets that are placed as orders or used as full-margin collateral can also automatically earn coins. Initially, this feature only supports USDT and applies to spot, contract, cross-margin, portfolio margin, and other account types, with more currencies to be gradually opened in the future.
For a long time, due to the need for risk isolation, major centralized exchanges have generally adopted a partitioned account design—trading accounts and wealth management accounts are independent of each other (even spot trading and contract trading under a trading account are independent). Although transferring funds between different accounts is not obstructed, this isolation design prevents users from balancing 'trading' and 'wealth management'. In general scenarios, users can still choose 'trade when needed, manage wealth when idle', but when placing orders and opening positions, they must give up the corresponding wealth management returns for that period.
In short, this is a 'decision dilemma' commonly faced by exchange users: should assets be kept in a trading account, ready to seize market opportunities, or transferred to a wealth management account to earn steady returns? Pursuing returns means that funds cannot be used flexibly for a certain period; maintaining liquidity, on the other hand, inevitably gives up potential interest returns.
Over the years, this paradigm has become a common practice among users, but habit does not imply perfection. From a product perspective, there is clearly room for optimization.
With leading exchanges such as Binance, Coinbase, and OKX successively launching targeted new features, this long-standing paradigm is being completely overturned. From the user's perspective, this means that the aforementioned 'decision dilemma' will be broken, and funds will achieve higher utilization efficiency and earning capacity; from the exchange's perspective, this may indicate that new product standards are taking shape, blurring the lines between trading accounts and wealth management accounts. In the future, 'trading equals wealth management' is expected to become a standard feature of exchanges.
In summary, being able to balance the needs of trading and wealth management in a simpler way is clearly good news for countless exchange users, and all of this is thanks to the competition among exchanges for users and funds. In the ongoing competitive landscape of trading, those who empower users better will win their favor. Looking ahead, as cryptocurrency compliance deepens, more new players will enter the scene, and the competition will only become more intense. As an ordinary user, I hope 'they make it even more lively'.
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