Binance Labs has attracted media attention by announcing a $10 million investment in LayerZero Labs Radiant Capital. Radiant Capital is already the third-largest lending protocol on Arbitrum.
Arbitrum Secures $10 Million From Binance Labs
Binance Labs has made quite a statement by announcing a $10 million investment in the LayerZero Labs-based lending and borrowing protocol, Radiant Capital. The strategic funding round raised capital that will be used for technology and product development. Quite a number of things are lined up for development, including Ethereum Mainnet deployment, expanding on Oracle support, cross-chain liquidation, collateral scaling, amortised reparations, double emission support, and full LayerZero messaging.
Binance Labs’ official blog post confirms that the development will attract 100 million new users into the DeFi space. Radiant Capital, which is built on top of LayerZero Labs, enables users to borrow and deposit cryptocurrencies. It is currently on Arbitrum on the Ethereum blockchain and on the BNB chain.
This latest development is expected to assist Radiant in its expansion efforts across multiple EVM chains. This eliminates the need for numerous transactions for swapping, bridging, borrowing, and lending between different chains.
How Does Radiant Capital Work?
Radiant Capital is a relatively new cross-chain borrowing and lending protocol built on LayerZero, which is a decentralised interoperability network. Anyone can deposit almost any major asset on any major chain and borrow supported assets across several chains using Radiant Capital. It also offers high security, low fees, and attractive interest rates for its users.
At Radiant, traders, or Dynamic Liquidity Providers, in this case, can lock in the RDNT token to profit from flash loan fees and interest. The token also grants them governance authority within the Radiant DAO. The protocol pays its platform fees in Ether (ETH), Bitcoin (BTC), BNB Coin (BNB), and some stablecoins.
Radiant currently has approximately $265 million in TVL and supports more than 20 collateral options, with plans to add more as the DAO expands. It was built using the infrastructure of LayerZero, which raised $120 million on April 3rd. As soon as the Binance investment news broke, Radiant Capital’s RDNT increased over 10%.
Binance Labs and Its Role in DeFi Projects
Binance Labs provides seed funding, technical guidance, mentorship, and marketing support to various DeFi projects to launch their products. It has also helped projects integrate with Binance’s products and services, such as Binance Launchpad, Binance Bridge, and Binance Smart Chain.
Some examples of DeFi projects in which Binance Labs has invested include:
- Maverick Protocol: Maverick Protocol is an ETH liquid staking token offered by Binance, allowing users to earn rewards for Ethereum staking.
- Pendle: Pendle is a protocol to tokenise and trade DeFi yields that allow users to separate future yields from their underlying assets and trade them on secondary markets.
- Synapse: Synapse is a universal interoperability protocol that enables cross-chain communication between different networks.
- Osmosis: Osmosis is a DEX-focused app chain built on the Cosmos ecosystem.
The Relationship Between Binance Labs and Arbitrum
Arbitrum had a prior relationship with Binance Labs before this latest development. For instance, Binance Labs has incubated and invested in several of Arbitrum’s DeFi projects, such as Magic, Hooked Protocol, and Radiant Capital.
Binance has also completed its integration with the Arbitrum One network, allowing users to transfer ETH and other supported tokens directly to their Ethereum wallets from their Binance wallet. Both entities share a common vision of bringing DeFi by offering friendly, secure, and inclusive financial solutions.
Explaining Arbitrum and Its Role in DeFi
Arbitrum is a suite of Ethereum-based scaling solutions that use Optimistic Rollup to allow cheaper transactions on a Layer 2 network. It frees Ethereum from much of its computing and storage responsibilities. Arbitrum does not have any native tokens associated with it.
Arbitrum’s commitment to EVM compatibility ensures that all the existing wealth of tools, resources, and knowledge is readily available for Ethereum development and can be applied to it. This compatibility extends beyond the core programming languages and includes the entire Ethereum ecosystem.
With Arbitrum’s seamless compatibility, developers can focus their efforts on building innovative and sophisticated DApps without being bogged down by the complexities often associated with adapting to new technologies. This ease of integration and reduced learning curve contribute to the widespread adoption of Arbitrum, attracting a diverse range of developers and projects looking to enhance their scalability and reduce transaction costs on the Ethereum network.
Read More: What Is a DEX?
The investment by Binance Labs in Radiant Capital will allow the latter to tap into the former’s extensive expertise, strategic support, and resources. These developments form a path towards attracting even more users to the fledgling DeFi space.
Frequently Asked Questions
Why Did Binance Labs Invest in Radiant Capital?
Binance Labs invested in Radiant Capital because it believes in the latter’s potential to facilitate seamless cross-chain transactions. It has also cited its performance on Arbitrum and BNB Chain as reasons.
What Are the Advantages of Using Radiant Capital on Arbitrum?
Using Radiant Capital on Arbitrum has several advantages, such as faster speed and lower fees, access to a large pool of liquidity across several chains, and the ability to borrow assets and use them from one chain to another.
What Is the Current Valuation of Radiant Capital?
The current market cap of Radiant Capital is $88.36 million, while the current price of the RDNT token is $0.304462. Its current circulating supply is 290.23 million out of a total supply of 1 billion.
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