IntroductionWith a 6% APY or annual percentage yield on BTC and 8.6% on stablecoins, the BlockFi Interest Account seems like a ray of sunshine for digital asset holders that have grown used to having their holdings slosh around with market volatility. Let me share with you an independent review of BlockFi and whether it is a legitimate means for you to generate passive returns. Who is BlockFiBlockFi is a privately-held NYC-based lending platform founded in 2017. The BlockFi Interest account is one of the only cryptocurrency storage option that pays offers rates that are competitive with most non-cryptocurrency account interest rates. BlockFi allows users to earn competitive compound interest rates on their cryptocurrencies, such as BTC, ETH, LTC, USDC, USDT, GUSD, and PAXG. Security of DepositsBlockFi’s cryptocurrency deposits are held by the Gemini Trust Company, regulated by the New York Department of Financial Services. It is available worldwide, outside of sanctioned or watch-listed countries. Gemini has never been hacked, stolen from, or otherwise compromised in any way during it's more than 5 years of operation. It is available worldwide, outside of sanctioned or watch-listed countries. Allows for anytime withdrawals. Users get one free withdrawal per month. Earn Up to 6% APYComparatively, BlockFi offers 43x more than “high-interest” savings accounts. However, it’s worth noting that BlockFi deposits aren’t FDIC insured, so BlockFi accounts shouldn’t be considered a savings account. It is an investment account, and users are exposed to a unique set of risks that traditional fiat savings accounts are not. Bitcoin Interest Rate: 6% up to 2.5 BTC, and then 3% on any amount over 2.5 BTC. If you are interested in Ethereum, then you can get up to 5.25% on any amount of Ethereum deposited. There are no monthly fees or charges. The interest rates are paid in their nominal cryptocurrency. For example, you will earn 0.06 BTC on 1 BTC in a full year, provided the interest rate stays the same. If you’ve been in the cryptocurrency space for a while you’re no stranger to the pros and cons of owning a volatile asset– your 0.06 BTC could either be more or less than its USD equivalent at the time of deposit, so plan accordingly. BlockFi Interest Account (BIA)BlockFi Interest Account clients can deposit their crypto and earn interest. Paid out at the beginning of every month, the interest earned by account holders compounds, increasing the annual yield. The BlockFi interest rates are fairly competitive, especially when compared to simply keeping your cryptocurrency on an interest-free exchange or wallet. Bitcoin: Users can earn up to 6% in annual interest on deposits under 2.5 BTC, and 3% on any BTC amount above that 2,5 BTC threshold. Ethereum: Users can earn up to 5.25% in annual interest on any ETH deposits. Account WithdrawalsYou can withdraw your funds at any time. BlockFi currently offer one free crypto withdrawal and one free stablecoin withdrawal per calendar month. Any further withdrawals may be assessed a fee as listed here. BlockFi TeamFounder & CEO, Zac Prince has experience in leadership roles at multiple successful tech companies. Prior to starting BlockFi, he led business development teams at Orchard Platform, a broker-dealer and RIA in the online lending sector, and Zibby, an online consumer lender. Co-Founder & VP of Operations Flori Marquez has experience managing alternative lending products. In the marketplace lending industry, she helped build, scale, and optimize a $125MM portfolio for Bond Street (acquired by Goldman Sachs). As Head of Portfolio Management, Flori managed all operations from point of origination through to default and litigation. BlockFi Funding AmountBlockFi recently raised $50 million in Series C funding lead by Morgan Creek Digital, with participating investors such as Valar Ventures, Winklevoss Capital, Kenetic Capital, CMT Digital, Castle Island Ventures, SCB 10X, HashKey, Avon Ventures, Purple Arch Ventures, Michael Antonov, NBA player Matthew Dellavedova, and two university endowments. As a company, BlockFi’s revenue has grown 10x over the past year, putting it on track to reach $100M in revenue over the next year. With over $1.5B in assets on the platform, and a 0% loss rate across its lending portfolio, BlockFi has made a strong case for establishing itself as a dominant entity in the overarching emerging FinTech space. How does BlockFi Make $$?BlockFi is a spread business that makes money by borrowing capital at a certain rate (the interest rates it pays to users) and lends it a higher rate (the interest rates it offers for BTC/ETH/GUSD loans). A BlockFi blog post notes that the company primarily works with institutional counter-parties to offer them liquidity. These borrowers consist of Traders and investment funds that seek arbitrage trading opportunities in a fragmented marketplace. They borrow cryptocurrency to close mispricing gaps between exchanges or dispersed markets. Margin traders will borrow to fuel their trading strategies. BlockFi Bitcoin Credit CardLaunching in early 2021 (but waitlist open to current BlockFi clients), BlockFi is launching a Bitcoin Rewards Visa Credit Card. Similar to cash-back credit cards, the BlockFi Visa will earn you rewards in Bitcoin! The card is set to earn 1.5% rewards rate in Bitcoin on all card purchases. Bitcoin Rewards Rate Boost. After three months of card ownership, the rewards rate of 1.5% back increases to 3.5% back in bitcoin on every purchase for the following three months, with an accrual payout of up to a maximum of $100 in bitcoin, paid out in the seventh month. Trading Bonus — Card owners who trade cryptocurrencies with BlockFi will earn 0.25% of their trading volume back in bitcoin, up to a maximum of $500 in bitcoin each month. How to Apply?Signing up for a BlockFi account is fairly straightforward and can be done in under two minutes. You can start right from this BlockFi review. Go to the BlockFi website using the link here. You can receive up to $500 on your deposit as a signup bonus, starting at $25 sign-up bonus when you deposit a minimum of $500.
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ConclusionWhether or not BlockFi is worth it comes down to your risk profile and what you’re doing with your cryptocurrency. The BlockFi interest rates are quite competitive for the industry, and for some digital assets, industry leading. If it’s just sitting on an exchange, you may as well reap the benefits of compounded interest. 10 BTC would turn into 10.62 BTC in a year, a not insignificant gain of around $5,000 for the year. You would also receive the benefits or tragedy of Bitcoin’s price going up or down. However, it’s worth remembering that any time your cryptocurrency leaves your hard wallets, it’s exposed to a higher degree of risk. If BlockFi or Gemini were to experience some (highly unlikely) catastrophic hack, your cryptocurrency would be at risk. . If you are looking for assistance on any topics related to zilliqa, feel free to drop me an email at [email protected] and I will do my best to create an education video around that topic.
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AuthorZilliqa Zebra provides news, updates, how-to, guides and all things related to the Zilliqa, the first public blockchain to implement sharding on its mainnet. Zilliqa Zebra is an ardent supporter of the Zilliqa blockchain. ArchivesCategories |