Centralized Exchanges Are Losing Out To DeFi Protocols

Centralized Exchanges are losing out to Defi protocols as they don’t have as many costs involved with transacting. The only way to get back into the game is to launch their own DeFi products and to get more customers as liquidity farming is the most popular activity out there. In our blockchain news today, we are reading more about the DeFi space.

The Singapore-based crypto exchange Huobi Global announced a DeFi liquidity mining campaign starting today on September 7 and the incentive is the first phase of the campaign which allows the users to stake its native Huobi Token. The announcement added that there will be an allocation of coins worth 5 million in USDT for DeFi liquidity mining. More rounds will be held after with a total of 10 million USDT worth of blockchain assets.

🚀#Huobi Liquidity Mining Launched!

Yield HT / HPT – Earn DeFi Tokens!

⛽️ZERO Gas Fees

$10,000,000 USDT worth of #crypto available

One-Click and DONE!

Details 👇

— Huobi (@HuobiGlobal) September 7, 2020

The rewards will be allocated to those that stake in the HP/HPT pool with HPT being Huobi Pool token. The cycle will run for two weeks with rewards being generated from the Curve Finance pool:

 “The reward will be [a] certain amount of CRV that the token gained from mining. However, the actual reward may be affected by the market volatility.”

Depending on the popularity of the ventures into Defi, Huobi plans to expand its offerings and should follow the footsteps of rival exchanges such as Binance. As centralized exchanges are losing on DeFi, Binance added to that sentiment as it launched its own Defi products. Binance launched its own bSwap which is an automated market maker to provide users with instant liquidity and lower fees.

Exchange customers can deposit Binance USD, Tether, and Dai to start earning interest in return for providing liquidity. The product seems to be aimed at Uniswap users that can do the same thing on the DEX but with higher gas fees. Binance targeted Etheerum with the launch of its Smart Chain that runs alongside Binance Chain in order to reduce transaction fees for the users. Binance Smart Chain will enable smart contract creation and a staking mechanism for BNB. As DeFi keeps on growing, the centralized exchanges have to keep up or risk becoming obsolete as DeFi incentives will follow bigger names in Cefi.