2026-01-08 16:22:06

BNB at the 800-900U level is indeed the bottom, everyone is eager to buy the dip. But the problem is, trading contracts is too risky—funding rates can eat up several percentage points, and a sudden liquidation is a nightmare that can easily crush your mindset.

Is there a way to increase your position without experiencing the knife-edge feeling of trading contracts? Actually, using cyclical lending can achieve a "spot-level gentle leverage." The method is straightforward: deposit BNB → borrow USD1 stablecoin → use the stablecoin to buy BNB on an exchange → continue to deposit the newly purchased BNB. With this operation, your original 10 BNB can support a position of 14-15 BNB.

Why is this more comfortable than trading contracts? The cost difference is huge. The interest rate on cyclical lending is only 0.41%, which is almost no holding cost, whereas in a bull market, funding rates on contracts can easily eat into your profits. Additionally, if you keep the loan-to-value (LTV) ratio below 55%, BNB would have to drop below 600U to trigger liquidation. This safety margin is much more reliable than opening a 5x contract.

This approach is especially suitable for those who firmly believe BNB will surge to 1000U, 2000U in this cycle. But remember: one cycle is enough, don’t think about infinite leverage—such operations are not investing, they’re gambling.

BNB0,28%

USD1-0,08%

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.

23 Likes

Reward
23
10
Repost
Share

Comment

0/400

Liquidated_Larry

· 01-11 15:52

Circular lending sounds great, but in practice, there are quite a few pitfalls.

View OriginalReply0

GasFeeCryer

· 01-11 08:49

Revolving lending is indeed ruthless, but how many actually dare to stop after one round? I think it's most likely another case of a recursive nightmare.

View OriginalReply0

shadowy_supercoder

· 01-09 15:18

Revolving lending sounds good, but is this operation really safer than smart contracts? It feels like playing with fire.

View OriginalReply0

TrustMeBro

· 01-09 00:01

Revolving lending sounds good, but have you really calculated the liquidation distance? Why do I feel the risk is still underestimated?

View OriginalReply0

GateUser-9ad11037

· 01-08 16:52

Circular lending sounds good, but in practice, there are too many pitfalls, and the LTV safety margin can't withstand black swan events.

View OriginalReply0

ChainMemeDealer

· 01-08 16:47

Revolving lending sounds pretty attractive, but I'm still worried about falling into a trap. Are the interest rates really that low?

View OriginalReply0

YieldChaser

· 01-08 16:42

Revolving lending sounds good, but is that 0.41% interest really stable? Are you not afraid that it might suddenly spike someday?

View OriginalReply0

FreeRider

· 01-08 16:36

The cycle lending system is indeed more comfortable than contracts, but is the 0.41% interest rate real? Why haven't I seen such a low rate before?

View OriginalReply0

SleepyValidator

· 01-08 16:33

Revolving lending sounds good, but how many actually dare to operate like that? The most feared moment is still being liquidated.

View OriginalReply0

BearMarketNoodler

· 01-08 16:33

Revolving lending is indeed more moderate than contracts, but a 0.41% interest rate looks cheap, and daily compounding adds up over time. The key is to have confidence in the future market; otherwise, even the lowest costs won't save you.

View OriginalReply0