Binance introduces Venus — a decentralized system for stablecoins

By: Ali Raza
Ali Raza
Ali plays a key role in the cryptocurrency news team. He loves travelling during his spare time and enjoys… read more.
on Sep 29, 2020
  • Leading exchange Binance recently revealed a new decentralized system for stablecoins, Venus.
  • The exchange's CEO stated that the system will be something between Compound and MakerDAO.
  • The system will bring a number of functionalities, and it is based on Binance's new Smart Chain.

Binance has come out with a lot of new products recently, including an entirely new blockchain, called Binance Smart Chain. Now, the exchange is putting it to use by launching a new system for stablecoins, which it named Venus.

Binance’s new decentralized stablecoin protocol — Venus

According to Binance, the new stablecoin system is fully decentralized, and built on the Smart Chain. It will work by minting a decentralized stablecoin, VAI, which is backed by a number of BEP-20 tokens.

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As some may know, BEP-20 is Binance’s own token standard, not unlike Ethereum’s ERC-20.

Binance’s CEO, Changpeng Zhao (CZ) noted that Venus is something between Compound and MakerDAO, at least when it comes to the way it works.

Details about the protocol

Binance explained how VAI functions further by saying that: “VAI is minted by the same collateral that is supplied to the protocol. Users can borrow up to 50% of the remaining collateral value they have on the protocol from their vTokens to mint VAI.

The collateral that will be provided to the Venus system will be represented by a number of vTokens, like vBTC. Users can then use them to redeem the underlying collaterals, borrow against it, and alike.

Lastly, by using the protocol, users will also have the ability to stake Binance-based tokens, such as BNB, BUSD, and SXP. The staking process will start today, September 29th.

After that, Binance plans to list XVS token into its Innovation Zone, which is scheduled to take place on October 6th. That is when it will open trading for a number of pairs against XVS, including pairs against Bitcoin, Tether, Binance Coin, and Binance USD.

The protocol itself came with Binance’s acquisition of the Swipe Wallet earlier in 2020.

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