Key Takeaways
Passive investing in cryptocurrencies allows users to earn rewards from their idle digital assets with minimal effort.
Passive investing with Binance Earn offers benefits such as competitive APR, low time investment, consistent investing strategy, and zero fees (except for ETH and SOL staking).
This guide covers the basics of passive investing and how to get started earning from your crypto holdings with Binance Earn.
Introduction
When people first begin their journey into cryptocurrency trading and investing, they often start with spot trading, which is among the simplest ways of buying and selling financial assets. However, many feel uncertain about what to do with their idle digital assets, so passive investing can be a good choice – and Binance Earn is a great place to get started.
In this article, we will cover the basics of passive investing, its potential benefits and limitations. We will also go through a quick guide on how to get started earning from your crypto holdings with Binance Earn.
What Is Passive Investing?
Passive investing is a way for people to grow their money without working too hard. It means putting money into things like stocks or cryptocurrencies and letting it grow over time. You don't need to check it all the time or do lots of buying and selling. This approach has gained popularity not only in traditional markets but also in the cryptocurrency space.
With passive investing, cryptocurrency holders are able to earn a steady stream of income from their digital assets without the need for frequent trading. In the crypto space, passive income can be generated through various methods, each with its own set of risks and rewards. A few common examples include staking, yield farming, and lending and borrowing.
Advantages of Passive Investing
Earn Rewards: Users can earn rewards and grow their assets, regardless of the market volatility, via passive investing.
Consistency: Passive investing usually follows a set investment strategy, allowing investors to maintain a consistent approach over time without the need for frequent adjustments or market timing.
Time efficiency: Passive investing requires less time and effort compared to active trading, making it suitable for investors who prefer a hands-off approach to managing their portfolios.
Limitations of Passive Investing
Market risk: Passive investing doesn’t involve active management to respond to changing market conditions, potentially leaving investors susceptible to market downturns or prolonged periods of underperformance.
Limited flexibility: Depending on the strategy or product chosen, investors may not have the flexibility to quickly access their funds.
Market concentration: Some passive investment vehicles may be heavily concentrated in a few large-cap assets or sectors, increasing vulnerability to risks or market downturns impacting those sectors.
What Is Binance Earn?
Binance Earn is a great place for users to receive passive income from their crypto holdings. It offers a diverse range of products to meet the needs of different investors, from beginners to experienced users.
Binance Earn provides users with access to two types of earnings: Simple and Advanced. You can choose to invest your crypto for predictable returns or opt for higher-than-average gains but with corresponding risks to your invested principal.
Simple Earn offers Flexible Products, Locked Products, ETH Staking, SOL Staking, and Soft Staking. Similar to a bank’s deposit, you can deposit your crypto and gain passive rewards. Advanced Earn includes Dual Investment, Dual Investment RFQ, Smart Arbitrage, and On-Chain Yields. They allow you to benefit from your market insights by leveraging different financial strategies.
How to Get Started With Binance Earn?
1. Log in to your Binance account and find [Earn] at the top menu.
2. You will be redirected to the Binance Earn interface. Here you can see the available products, such as Simple Earn, Advanced Earn, and Loan.
On the page, you will find a summary of your holdings and an estimate of your returns on the last day.
3. Scroll down to find a list of available products. Here you can see the different assets followed by estimated APR and duration. You can also use the search function or filters to look for specific assets.
4. To start earning from your holdings, you have to choose a product offering and subscribe to it. Add the amount of funds you want to use, check the summary and click Confirm when ready.
You can check the Product Rules tab at the top for more details on each offer.
5. The Flexible options allow you to redeem your funds anytime. The locked ones will require you to lock your funds for a certain period. Below is an example of a Locked term product, with different lock-up periods.
How to Get Started With Binance ETH Staking?
1. Open the Simple Earn section on Binance. You’ll see different staking options like ETH, SOL, and Soft Staking. Click on [ETH Staking] to begin.
2. Once you're on the ETH Staking page, you’ll see information like the Reference APR, Conversion Ratio, and Total ETH Staked. These give you a snapshot of the potential rewards and current status of the staking pool.
3. To start staking, click [Subscribe] and enter how much ETH you want to stake. In return, you’ll receive WBETH (Wrapped Beacon ETH)—a token that represents your staked ETH plus rewards. Read and agree to the terms and click [Next]. You can check the Product Rules tab at the top for more details on the offer.
4. WBETH lets you keep earning staking rewards while still using your staked ETH. Unlike traditional staking, where your ETH is locked, WBETH is tradable and transferable. You can sell it, move it to your personal wallet, or even use it in DeFi platforms outside Binance and still earn staking rewards.
5. If you want your ETH back, go to [ETH Staking] and click [Redeem]. Enter the amount of ETH you would like to redeem from your BETH or WBETH balance, and click [Redeem]. You'll receive ETH based on the current WBETH to ETH conversion ratio at the time you redeem.
How to Get Started With Binance SOL Staking?
1. Open the Simple Earn section on Binance. You’ll see different staking options like ETH, SOL, and Soft Staking. Click on [SOL Staking] to begin.
2. Once you're on the SOL Staking page, you’ll see information like the Reference APR and Conversion Ratio. These give you a snapshot of the potential rewards and the current status of the conversion rate between SOL and BNSOL.
3. To start staking, click [Subscribe] and enter how much SOL you want to stake. In return, you’ll receive BNSOL (Binance Staked SOL)—a token that represents your staked SOL plus rewards. Read and agree to the terms and click [Confirm]. You can check the Product Rules tab at the top for more details on the offer.
4. BNSOL lets you keep earning staking rewards while still using your staked SOL. Unlike traditional staking, where your SOL is locked, BNSOL is tradable and transferable. You can sell it, move it to your personal wallet, or even use it in DeFi platforms outside Binance while still earning staking rewards.
5. If you want your SOL back, go to [SOL Staking] and click [Redeem]. Enter the amount of BNSOL you would like to redeem from your BNSOL balance. Read and agree to the terms and click [Confirm]. You'll receive SOL based on the current BNSOL to SOL conversion ratio at the time you redeem.
How to Get Started With Binance Soft Staking?
1. Open the Simple Earn section on Binance. You’ll see different staking options like ETH, SOL, and Soft Staking. Click on [Soft Staking] to begin.
2. Click [Activate]. Ensure you read and agree to the Soft Staking Terms (and associated Risk Warnings) and click [Start Earning].
3. By participating in Soft Staking, you can earn rewards generated through the blockchain’s staking mechanism, also known as Proof of Stake (PoS). Rewards are typically paid out in the blockchain’s native token (unless otherwise specified).
Closing Thoughts
Passive investing in cryptocurrencies can offer great opportunities for individuals to grow their holdings over time with minimal effort. Binance Earn gives users access to a variety of products designed to maximize passive earnings while minimizing risk.
Further Reading
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