In a recent update, leading exchange Binance announced support for staking. However, the initiative received flack from the crypto community and has also been accused of going against the spirit of decentralization.
Are Users in For Maximum Benefits?
Binance CEO, Changpeng Zhao (CZ) recently via a tweet announced support for staking. Some of the coins which can be staked on the platform include NEO (NEO/GAS), Ontology (ONT/ONG), Vechain (VEN/VTHO), Stellar (XLM), Komodo (KMD), Algorand (ALGO), Qtum (QTUM), & Stratis (STRAT). Staking is the process of holding funds in a cryptocurrency wallet to support the operations of a blockchain network.
The users will be able to earn stake rewards without having to become nodes. They simply need to keep a balance of crypto in their Binance account and get going! Additionally, Binance will support, in conjunction with project teams, additional promotional rewards to incentivize users to stake on Binance. These rewards will be distributed on a case-by-case basis. Also, Binance will not be charging a fee on any staking operations.
Is Binance’s Staking Program Against the Spirit of Decentralization?
His announcement garnered several responses from the crypto community. Dovey Wan, founding partner, Primitive Crypto considered it be a bad idea. Furthermore, she said that if funds are staked on the exchange it will not offer a value proposition for the users, as first, the exchange will eat up the funds. Secondly, they will be eaten by the custodial wallets. And, last but not the least, by PoW, whatever little will be left will be distributed to users staking their funds.
Calvin Ayre, founder of Ayre Group and CoinGeek said that CZ is scamming. He further shared a tweet which said that the idea behind Bitcoin is to minimize the harmful effect of staking. The tweet takes a dig at staking and said that it is simply not easy to make money doing nothing and the massive expansion on the Binance platform goes against decentralization and the original bitcoin whitepaper’s propositions.
Interestingly, crypto twitter seemed to agree with Dovey Wan and Calvin Ayre.
A crypto user with handle ” ChainLinkBull” said that everything will be gone if centralized, thus, resonating with Wan’s claims that users will be at the losing end.
Others users also expressed similar sentiments about Binance staking being against the principle of decentralization.
Binance Enables Deposits and Withdrawals for Interoperable Tokens
Today, Binance announced support for withdrawing and supporting interoperable tokens. The exchange has upgraded its deposit and withdrawal functions so that users can now more freely deposit and withdraw interoperable tokens to their preferred network via the web interface.
The list of supported interoperable tokens include –
USDT: ERC20, OMNI
PHB: NEP5, BEP2
ANKR: ERC20, BEP2
ARN: ERC20, BEP2
BCPT: ERC20, BEP2
CHZ: ERC20, BEP2
COS: ERC20, BEP2
DUSK: ERC20, BEP2
FTM: ERC20, BEP2
GTO: ERC20, BEP2
MITH: ERC20, BEP2
TOMO: TOMO, BEP2
It will be interesting to note how Binance reacts to all controversies around its massive expansion. Let us know, what you think!
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Coming from a physics background the unpredictability and intrigue of the cryptoverse attracted me to take a dive in this field. I am all eyes and ears for the latest trends in blockchain and crypto sphere. Whenever I am not writing or researching, I love to read sci-fi novels, play basketball and watch action movies. I strongly believe that blockchain and cryptocurrency will bring lasting transformations in people’s lives in the years to come. You can reach out to me at supriya [at] coingape.com.