Binance Liquid Swap Explained 2023

Binance Liquid Swap is one of the popular products that the platform provides to all its users. It is an easy way for affiliate marketers and advanced traders to earn passive income on their cryptocurrency assets earned from trading or having promoted the Binance referral program because of its low fee and instant rewards. If you are looking for an article that has Binance Liquid Swap explained, then you have come to the right place!

Binance is the largest crypto platform that is committed to providing innovative products and services to all its dedicated users. It aims to enhance the standards for the crypto industry by evolving into an ecosystem that acts as a nexus between centralized finance(CeFi) and decentralized finance(DeFi). Read our Binance Liquid Swap review to know more! 

What is Binance Liquid Swap?

Liquid Swap is a platform that allows users to earn money using the AMM ( Automatic Market Maker) principle through liquidity pools. It is one of the Binance Earn products and is part of Binance’s DEX (Decentralized Exchange). 

It is a way for users to benefit from the security, convenience, and high liquidity of the Binance platform by being part of the DeFi financial technology.

Liquid Swap was launched in 2020, and since its launch, it has distributed over 11,570,000 USDT in rewards, with more than 20,000 users benefitting from its low fees, among other features.

Binance Liquid Swap interface

How does Binance Liquid Swap work?

Liquid Swap consists of different liquid pools that host two fiat assets or digital coins where users can exchange crypto assets. Since it is based on the AMM principle, the traders who add and remove funds from the pool are involved in market making.

Users who participate by staking or adding funds to these pools earn a fee through all transactions that use their assets and also through a flexible interest rate. The fee will also depend on how much you have staked in proportion to the total amount staked by other traders.

In addition, traders can swap crypto assets in the pools by paying a small transaction fee. Most users prefer this option because the fee is much less than what you usually pay in a centralized exchange.

Recently, Binance introduced an upgraded version of Liquid Swap that is Liquid Swap 3.0. It gives triple income for liquidity providers through traditional fees, interest and liquidity rewards.

Here is a quick guide on how to use the Binance Liquid Swap:

  • Sign in to your Binance account, choose “Finance” from the navigation bar and click on”Liquid Swap” from the drop-down menu. This will direct you to the your account page which will give you an overview of the pool platform. 
  • The next step is to add crypto by choosing a liquidity pool. Choosing the best liquidity pool is based on coins you wish to stake and the risks you are ready to take. 

There are two types of coins- Stablecoins and Innovation coins. Stablecoins, as the name suggests, will guarantee your investment but will give you a lower interest rate and bonus liquidity award. 

Whereas Innovation coins are affected by coin price fluctuations and exchange rate, thus making it a risky investment with a possible impermanent loss, it yields higher returns.

Staking an Innovation coin will bring double the profit, but if it gets devalued too low, then you may lose your yield because of the AMM adjustments. Therefore, you must decide based on which coin most people borrow.

If you wish to swap your coins, then head on to the “Swap” button on the “Pool Overview Page“. You may have to give a quiz and input the correct Liquid Swap Binance quiz answers if you are a beginner.  

Thereafter, you can “add” or “remove” crypto-assets from the liquidity pool and complete your transaction. If you want to swap coins, then go to “Swap” on the navigation bar. 

Select the crypto asset you want to sell or buy. After you’ve selected, it will automatically show you the exchange price, handling fees, and slippage according to a formula they use and based on the amount of the cryptos in the pool. Click “Swap,” and you’ve successfully completed the process.

Liquid Swap vs. Staking

Liquid Swap is the process of swapping your crypto coins from one type to another. It is the process of buying and selling crypto assets by swapping. In contrast, staking is a process through which traders stake or add their crypto assets in the liquidity pool and earn through interest rates and transactions fees when their assets are used.

What are the Advantages of Using Binance Liquid Swap?

  • Huge selection of liquidity pools

The Binance Liquid Swap has a wide selection of liquidity pools numbering over 97 in its platform. Each pool has at least $1 million liquidity, with some of the highest containing more than $350 million crypto assets. It hosts a large number of crypto assets, including BTC, BNC, altcoins and stable coins.

  • Easy user-interface

The Liquid Swap feature is easily navigable, unlike other liquidity pools where users have to visit many sites and wallets to swap. You can perform all functions of adding, selling, removing or swapping at the click of a button.

  • Quick earnings

Traders can make use of the higher APYs ( Annual percentage yields) of the liquidity pools through its Innovation pools. While these pools are subject to everyday market movements, the double-digit returns they give are worth a try. But, if you would like a no-risk strategy, then going for Stable pools will be the best option.


How to use Binance Liquid Swap?

Log into your account, go to “finance,” choose “liquidity swap,” and you’ll be directed to the Pool Overview page.
Once you’re here, navigate to the “liquidity” tab to “add” it “remove” coins to the liquidity pools, or go to the “swap” tab and choose which coins you like to swap


Many Binance traders are using the Binance Liquid Swap feature to advance their trading skills and make the most out of the crypto market. Swapping coins is easier and quick because of the AMM calculator that lets you know the fees and rates in an instant. 

If you are still not sure of how it works, then check the Binance Liquid Swap tutorial on their official website and/or read this Binance review to learn more about Binance altogether. 

Crypto Affiliate Programs » Binance Liquid Swap Explained 2022
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