A New Bitcoin ETF Hopeful is Many Moons Away, But You Don’t Have to Wait for Bitcoin Interest Accounts Now
The dream of cryptocurrencies replacing bank just got a step closer. This Tuesday BlockFi has launched a crypto deposit account that provides compound interest. The BlockFi Interest Account (BIA) is now live and gives customers an annual interest rate of 6 percent, paid on a monthly basis in cryptocurrency.
That monthly interest is then compounded to produce a 6.2 percent annual percentage yield. Users all over the world can deposit either bitcoin (BTC) or ether (ETH) to earn interest from the offering and can withdraw their funds at any time.
However, the catch is that interest will be paid in either bitcoin or ether, depending on the account deposits, making this account most appealing to those who want to accumulate as much bitcoin and ethereum as possible.
The savings accounts in question are not newly opened accounts. Instead, these accounts have been in a private beta phase since the start of 2019 and currently hold over $10 million in assets. BlockFi’s tweet stated:
“Today we are launching the BlockFi interest Account (BIA). Users can securely store Bitcoin or Ether at BlockFi and receive 6% annual interest, paid monthly in cryptocurrency! BIA interest compounds monthly, delivering an industry-leading APY of 6.2%.”
The post also specifies that client assets are custodied at the Gemini Trust Compan, which is regulated by the New York State Department of Financial Services.
The post also notes that clients are reportedly able to withdraw funds from such accounts at any time. The company claims:
“BlockFi’s proprietary risk management system, which automatically initiates margin calls and liquidations to protect our customers’ assets, has a perfect zero-loss performance record since launching in 2017.”
“BlockFi is the first crypto challenger bank. Bitcoin and crypto lending, especially to retail investors, is a nascent market. It has though been pushed on by institutional interest over the last year or so,” BlockFi chief executive Zac Prince said.
Last year, BlockFi was able to raise $58 million in investment. The company has the goal of becoming the number one provider of financial services to all cryptocurrency investors. It offers loans in BTC, ETH, and LTC with interest rates of about 4.5%.