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Binance just launched its second DeFi-focused initiative

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With the DeFi sector surging and becoming more profitable by the second, many of the major players in the crypto industry have made moves to try and benefit from the emerging trend. The leading crypto exchange, Binance, is, of course, among the biggest movers to DeFi right now.

Binance launches Liquid Pool for increased liquidity

Binance seems to see great potential in DeFi, as the service launched two separate initiatives meant to serve as entry points into the growing market. The latest of the two is the launch of its automated market maker (AMM) pool, called Binance Liquid Swap.

According to the exchange’s announcement, the new platform will be the first such project to ever be done by a centralized exchange. Users will not only be able to use it for trading, but also for hosting liquidity pools, and earn rewards in the process.

Basically, Binance Liquid Swap users will have the ability to place their own crypto in liquidity pools. Doing so will increase the liquidity of the market. Naturally, users will receive rewards, with the number of assets per liquidity pool being the main factor in determining the price and transaction fees on the AMM.

With the project still being rather new, it currently only has three trading pairs, which revolve around stablecoins — especially Binance’s BUSD. Those include USDT/BUSD, USDT/DAI, and BUSD/DAI.

Binance’s new blockchain — Binance Smart Chain

As mentioned, Binance Liquid Swap is only the second and the latest attempt by Binance to ensure its place in the DeFi sector. Only days before its launch, the exchange also launched its second blockchain, Binance Smart Chain.

The blockchain will be compatible with Ethereum-based protocols, and it will allow Binance to develop its own DeFi protocols on it.

Furthermore, it is interoperable with Binance’s existing Binance Chain — its original blockchain. The two run in parallel, and will continue to do so with no plans to disable one in favor of the other at this point.

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