Rewritten Version:

Binance has launched BTC Yield, a new offering aimed at existing Bitcoin holders who want to earn passive income without selling their coins—mirroring similar yield-focused strategies from firms like BlackRock.

Accessible through Binance Earn, the product allows users to deposit BTC in exchange for BTCY, an internal unit that represents their participation in the strategy. All activity is conducted in bitcoin, with no option to fund using stablecoins or other assets.

Binance uses the deposited BTC as collateral to sell call options, collecting premiums from traders betting on price upside. A majority of those premiums are then passed on to users.

Covered call strategies are common but often complex. Binance simplifies the process by managing the strategy entirely in the background, making it easier for retail users to access.

Dual income streams

BTC Yield delivers returns in two ways. First, a portion of the option premiums is converted into BTC and distributed weekly—typically on Fridays—directly to users’ spot accounts.

Second, the remaining premiums are retained within the strategy, gradually increasing the value of each BTCY unit. Over time, this means each unit is backed by more BTC, allowing users to redeem a higher amount later.

Binance’s head of exchange and trading, Shunyet Jan, said the product is designed to make a traditionally complex strategy more accessible, giving bitcoin holders a way to earn income without active trading.

The launch aligns with a broader trend, as traditional finance players like BlackRock introduce similar income-generating bitcoin products using covered calls.

Risks and limitations

Like all options-based strategies, BTC Yield carries risks. Binance takes a 15% share of gross premiums before distributing returns, and redemption fees apply when users exit.

Returns are not guaranteed, and weekly payouts could be zero. The strategy may also cap upside during strong rallies, as call options may be exercised. In bullish conditions, simply holding BTC may outperform.

Overall, BTC Yield offers a straightforward way for long-term bitcoin holders to generate income from idle assets, but it’s best suited for those comfortable with the associated trade-offs.