So hey! I wanted to see how it works and gave it a try. Thought someone might be interested to see how it goes. Let's have a look.
I deposited 0.00226421 BTC to Binance's Dual Savings on 5th November, 2020. The strike price for this product (image below) was $14500 with a 82% annualized return rate to be delivered on the 20th of the same month.
This means, simply put, if the BTC settlement index is less than the strike price ($14500) when the product ends (20th Nov), then i will receive a fixed interest on the bitcoins and get paid in BTC. However, if the BTC settlement index is higher than the strike price, my returns will get settled in BUSD. Dual Savings works in such a way that if the strike price is high and the product period is short, the product has less risk and the yield is low. Vice versa, if the strike price is low and the period is long, the high the risk is which means higher yield.
The bitcoin amount of 0.00226421 at the start of the contract was around 31-32$ and since BTC has been on a bull run lately, the strike price has been exceeded, which is great news for hodlers but not exactly for this particular contract I was trying. To be honest, I didn't think it will reach the strike price so easily. Such is the beauty of it all though.
Let's take a look at the settlement. I got paid in BUSD, since the contract is 14 days, the interest calculation formula is BTC deposited x (14/365 x 82%). As mentioned, since BTC has been on a bull run and the value keeps climbing, the amount of bitcoin I can buy back with 33.9 BUSD is comparatively low, the amount of BTC I deposited is worth 42.53$ today. This little article may be used to assert the massive benefits of HODLING. Heh.
I have come to conclude that I should probably stay away from Dual Savings during bull runs and as Binance Academy video mentioned; it is suitable for professionals (which I am mostly not). This is indeed a way to earn interest whichever way the market goes but everything has a downside, so, lets conclude with the compulsory DYOR and DYOR and then, DYOR. That's about it. I tried this twice, I will try to make another report on Dual Savings once the other product is expired with proper screenshots. Still, I hope this provides some insight. Good day!!