Following the launch of its institutional loans program on its centralized platform, offering up to 4x leverage and potential zero-interest terms for high-net-worth customers, Binance has launched a Web3 loan feature within its self-custody wallet.
The world’s largest exchange has spread its tentacles across the decentralized finance space with its expansion into lending.
Ethereum protocols control about 80% of the DeFi lending market share. The move pits the world’s largest crypto exchange by trading volume against established players like Aave, which alone controls about 60% of the DeFi lending sector.
Binance Wallet launches DeFi loans with Venus Protocol
Binance just announced that users of its self-custody wallet can now access DeFi loans. The exchange partnered with Venus Protocol, the largest DeFi lending platform on the Binance Smart Chain (BNB), boasting over $22 billion in liquidity.
Users can now borrow by using assets like Ethereum and Bitcoin as collateral. There is also a 400,000 USDT reward pool to be shared among eligible borrowers.
Users can access the Web3 Loans facility through the Web3 Earn page in Binance Wallet, where they deposit collateral. The loan is set up in a way that keeps assets under user control, while unlocking liquidity for trading or yield farming, eliminating the need to sell assets, which could trigger taxes in places like the U.S.
Binance serves more than 240 million users globally, giving it a potential distribution advantage as it targets a market that has grown to over $54 billion in total value locked across DeFi lending platforms as of mid-2025.
DeFi lending protocols lock a combined $63.3 billion value after peaking earlier in the year. Source: Defillama
Binance’s move exploits its low transaction fees and faster speed to draw users away from the Ethereum ecosystem. BNB’s DeFi ecosystem currently boasts over $17 billion in total value locked.
Can Binance challenge Ethereum DeFi lending?
Ethereum currently holds the majority of the DeFi lending market, holding almost 80% of the market share. The major DeFi lending platforms on Ethereum, Aave, MakerDAO, and Compound, hold about 72% of the market share.
Aave increased its TVL by 52% in Q2 2025, outpacing broader DeFi growth of 26%. The protocol has expanded across 14 blockchain networks and handles billions in flash loans and cross-chain transactions monthly.
Binance is leveraging cheaper transaction fees and an overall better user experience to compete. Platforms built on other chains like Solana, which holds 5.1% of DeFi deposits, have demonstrated that users will migrate for lower costs and better performance.
Market data also suggests there’s room for competition despite Ethereum’s lead. DeFi lending is experiencing rapid growth, with over 7.8 million users. The market has also surged by about 38% from $19.1 billion in 2024 to over $26 billion by mid-2025.
The partnership with Venus Protocol gives Binance immediate access to established DeFi infrastructure rather than building from scratch.
