CandleFocus

How Can BFUSD Generate an Average APY of More Than 30%?

BFUSD is a reward-bearing margin asset launched by Binance in 2024. It offers a high Annual Percentage Yield (APY) that has recently ranged from 30% to 47%. The APY is derived from staking fees and funding fees from the previous day, which are influenced by market demand and volatility. BFUSD has a robust Reserve Fund that protects users from negative funding rates during bearish market conditions. Backtesting has shown that the Reserve Fund can withstand extreme market scenarios and provide stability for BFUSD holders. However, it's important to note that the APY is not fixed and past results do not guarantee future performance. BFUSD is designed to generate consistent APY even in a volatile market, and the Reserve Fund is regularly managed and adjusted to ensure its adequacy. Users should carefully consider their investment decisions and consult a financial advisor before investing in BFUSD.

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