Back on March 2023 i was really shocked when Binance announced the termination and redemption of all Binance Earn products in its trip towards regulations in the United kingdom and I wrote my first article about this with title "The Binance Redemption". Casualties οn this battle from regulation institutions were heavy. All of my Binance Earn investments have been redeemed into my Binance SPOT wallet and i was so disappointed that I almost lost any interest about my cryptoassets and the financial revolution of Satoshi Nakamoto. Visiting the Binance app to check my Binance earn investments and participate in Binance LaunchPools and LaunchPads was my favourite daily activity first thing in the morning... even before or while visiting the restroom. At least I felt lucky that my BETH staking was still safe since it was operated through the Ethereum Foundation and it wasn't an Earning Product of any specific cryptoplatform.
Slowly slowly i managed to adapt myself on this situation by diverting part of my cryptofunds to other investing channels (another article might follow soon) and I had to accept the situation after learning that the FCA (Financial Conduct authority), which is the UK financial regulator, is expected to propose rules on Issuing and Holding cryptocurrency in accordance of the BASEL III Committee and the Financial Services and Markets bill that has been discussed on the UK Parliament. In fact I was hoping that the new regulation for the UK financial promotions and adverts Regime which was scheduled for October 8th, 2023, will permit Crypto Interest Earning Products from the crypto platforms at the same way that "inflated" FIAT Interest Earning Products are allowed to be operated from the FIAT banks of the establishment.
Alas, I was again disappointed. Binance sent me another email informing me that the new UK financial promotions and adverts Regime will be expanded to apply to marketing activities constituting “financial promotions” of “qualifying cryptoassets.” and therefore they decided ONCE AGAIN to comply by removing several aspects of the Binance platform such as Gift Cards, Academy, Research, Feed and even Referral bonuses! The truth is that I tried hard to find any specific information about the UK Financial Promotions ACT and the expansion for the “financial promotions” of “qualifying cryptoassets.” but i couldn't find any specific webpage on the web.
After, almost an hour later, I received a second email stating again that Binance is removing all the Binance Earn products as well.
This time, the ETH Staking operation was included in the list and Binance was providing an advice to redeem any ETH Staking subscription before 11.03.2023 as no Staking rewards will be accrue thereafter and the remaining BETH will be wrapped into WBETH on the WBETH:BETH real-time ratio of that date.
Again I was shocked and disappointed as BETH was my only earning product still operating on my account having converted to BETH a substantial amount of ETH and accumulating a substantial amount of BETH since DAY 1 of the BETH operation even if the interest rate has fallen significantly.
Even worse when i tried to visit my Binance account to exchange my BETH back to ETH and divert it to other cryptochannels, Binance denied access until the app will be "regulated" according to the new regulation law by removing all the above mentioned features!
And then I decided to take a long breath and think twice.
What is WBETH?
Since I have never "Wrapped" any of my cryptoassets before, a quick googling brought me to the relevant Binance webpage with title "Wrap BETH into WBETH" where Binance explains that Wrapped Beacon ETH ("WBETH") is actually a wrapped version of BETH where -according to Binance- the accumulation of ETH2.0 staking rewards isn't performed by growing in number, but by growing in value in relation to BETH. I am not sure exactly how it might work but Binance explains that unlike BETH, the value of WBETH will increase despite being held in Binance Spot Wallet and will provide double yield potential i.e (i) by holding it to earn staking rewards, and (ii) by moving it on-chain and exploring exciting DeFi and other dapps opportunities. Although I am not interested in any DeFi activity that involves paying fees for any transaction in the chain, I decided to retain my BETH after the 03.11.2023 on my SPT wallet and see how the accumulation of WBETH will provide me the lost interest from the BETH staking.
For those who don't know what is BETH i suggest you the relevant Binance webpage with title "What is BETH"
Final Thoughts
Back on July 2022, CZ was very clear for his intentions when an article on Binance blog with title "CZ FAQ 5 - Why Binance Embraces Regulations" he explained his determination that complying with the established regulation was his main priority for his company.
From the other hand, the UK Goverment through the Bank of England committee is trying to justify the new UK Financial Promotions ACT will be expanded to apply to marketing activities constituting “financial promotions” of “qualifying cryptoassets.” with the argument that
"Trading in cryptoassets involves a high degree of risk and may not be suitable for all investors. The value of cryptoassets can be extremely volatile and unpredictable, and can fluctuate significantly in a short period of time. Investors should carefully consider their investment objectives, risk tolerance, and financial situation before trading in cryptoassets."
I won't disagree that FCA is doing a great job by continuously warning investors about clone and unauthorised firms from the UK financial markets as seen below
However, I personally DISAGREE that the Interest Earning Products provide ANY kind of RISK of Capital Loss since the only outcome of the investment is the increase of the investment at the same way that I invest my FIAT capital to Interest Earning Products on my FIAT Banking Organizations! Otherwise I would never have tried to invest on these products! There is no TRADING involved at all!
The only thing that I am still curious to see if they will be still in use is the LAUNCHPOOLS and LAUNCHPADS Products. My friend PVM on his recent article with title "Going Arkham with Binance Then CyberConnected With The SEI Blockchain", insists that LaunchPools are still in operation and that more LaunchPools are about to be published on the platform, however since March 2023 I have never participated in ANY LaunchPool believing that the product isn't permitted for UK users. Please let me know your thoughts too.
Disclaimer: All information found on this article is for informational purposes only. I do not provide any personal investment advice so please make your own research before proceeding to any investment/trading actions
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