Earning secrets:
Buying 10 BNB at the beginning of the year and compounding rewards on Binance, how much can you earn by the end of the year?
Article reprinted from: Frank
Author: Frank, PANews
In a bull market, there seem to be countless ways to make money. Some people chase angles with MEME, others stay up all night trading contracts, and some work hard to farm airdrops. Besides these methods, is there any way to profit without 'grinding', without gambling, and without heart-pounding? Some smart money is targeting Binance's Launchpool or Megadrop activities to achieve their compound interest goals. In this article, PANews will review various activities on Binance over the past year and simulate how much return can be gained by holding 10 BNB by the end of the year.
Throughout the year, 28 token launch airdrop events could be participated in.
Overall, the returns from BNB can be divided into three major parts: first, the value increase brought by the price increase of the BNB token itself. Second, the reward returns from participating in Launchpool activities. Third, the earnings from Megadrop, Hodler Airdrop, or other staking returns.
Taking January 1, 2024, as the starting date for the calculation period, on January 1, the closing price of BNB was $313.5. At that time, buying 10 BNB required a total capital of about $3,135. As of December 31, the price of BNB was about $702.3, an increase of approximately 124% since the beginning of the year. Based on this, the return from holding BNB is about $3,880.
In addition to the growth returns of BNB, Binance's Launchpool is another type of activity with the highest user participation. Participating projects will reward users who stake BNB or other stablecoins with a portion of the token rewards. As of December 31, about $1.53 billion is locked in Binance Launchpool, with over 6.1 million unique participants historically. In 2024, Binance launched 21 Launchpool activities.
According to PANews statistics, if users participate in these Launchpool activities from the beginning of the year, they can expect an average return of about 1.6% in token amounts for each participation. If based on the highest price of the reward tokens, the average income per participation would be $70. The total potential returns from this could reach $1,481. The overall return rate from participating 21 times is about 47.2%. Among them, the activity returns of Altlayer are the highest, about 5.93%, with a return amount of $173.3. PIXEL follows with a return rate of about 4.45%, amounting to about $156.
In addition to Launchpool, Binance also launched 2 Megadrop and 5 Hodler Airdrop events this year. If you participated in these 7 activities simultaneously, the total income would be about $557, with a return rate of about 17.7%.
In summary, participating in Binance's Launchpool, Megadrop, and Hodler Airdrop yields a maximum combined return of 65%. Combined with the increase in token price of 124%, the total return rate can reach 187%. Overall, participating in these activities can ultimately increase the invested principal of $3,135 to $9,087.
Compound interest practical returns are higher.
Of course, the above methods may not be the optimal solution for maximizing returns. Many believe that if compound interest thinking is introduced, converting every reward or token obtained from participation into BNB, this could increase the amount of BNB, thus providing more principal to participate in activities, and the overall returns should become greater.
First, this operation method may have certain flaws, and we cannot calculate returns based on the highest price. In principle, using this method requires selling the tokens immediately after receiving them to avoid missing the next activity. Therefore, the calculations are based on the closing price on the first day after these activity tokens are listed.
Using this compound interest method for calculations, after participating in 21 Launchpool activities, the 10 BNB held could ultimately become 12.39 BNB. The increase of BNB tokens by 2.39, based on a price of $702.3, amounts to about $1,678. Adding the profits from Megadrop and Hodler Airdrop activities of about 0.62 BNB, the final BNB amount could reach 13. If using the method of selling activity tokens each time and buying BNB, the final amount would be approximately $9,136.
This return result is higher than merely participating in activities and selling at the peak, and the biggest advantage is that this method is more practical because no one can always sell at the highest point. Compared to normal participation in activities, where the reward tokens are directly sold without converting to BNB, the final actual asset total is about $8,490, whereas the compound interest method is still more advantageous.
Value increased to 2.7 times in one year, over 70% of tokens performed well.
Regardless of the operation method, ultimately, using a principal of 10 BNB worth $3,315, after a year of practical operation, the total amount could reach a range of $8,490 to $9,136. The overall wealth change is approximately between 2.56 times to 2.75 times. Of course, the largest source of returns remains the appreciation of BNB, followed by Launchpool activities.
Comparing the maximum price fluctuations of the 182 spot and contract trading pairs listed on Binance this year, such returns exceeded the performance of 73.6% of the tokens in the sample. On the surface, such returns may not seem significant in the face of the thousands of times returns in the crypto world. However, for users with larger capital scales, pursuing relatively stable returns, or those keen on earning rewards but unable to participate in farming, this type of operation seems to yield considerable results. First, in terms of input-output ratio, whether it’s farming airdrops or trading MEMEs, the time and costs spent on-chain are always considerable, while participating in such activities is relatively easier. Secondly, the high volatility of MEME coins and the uncertainty of airdrops significantly lower the chances of investment success, while markets with smaller fluctuations tend to offer relatively stable returns. Therefore, these types of earning activities seem to have a sand pile effect.
However, any investment strategy should undergo extensive data analysis and fundamental judgment before actual implementation. The above content is for reference only and does not constitute investment advice.
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