Morgan Creek-Backed BlockFi Starts Offering Crypto Deposit Accounts To Provide Compound Interest
BlockFi Starts Offering Crypto Deposit Account That Provides Compound Interest
The crypto startup BlockFi announced a new crypto-related deposit account that allows users to receive compound interest on their funds. The new service is called BlockFi Interest Account (BIA) and it offers customers an annual interest rate of 6 percent that is paid on a monthly basis in virtual currencies.
Users can start depositing Bitcoin (BTC) or Ether (ETH) to start earning interest from this offer. It is also possible to withdraw funds at any time. The funds are custodied by the Gemini Trust Company, which was co-founded by the Winklevoss twins. The firm is regulated by the regulatory agency of New York and it offers insurance coverage for these funds.
According to Brad Michelson, the director of marketing at BlockFi, explained to CoinDesk that the BIA does not come with the backing of the federal government, which offers these services to savings accounts and banks.
It’s worth mentioning that BIA was launched in a beta version and now it is available for interested users around the world. BlocFi was able to raise $4 million in a funding round led by Akuna Capital. Other investors include Anthony Pompliano, founder and partner at Morgan Creek Digital.
In a recent blog post released by Morgan Creek Digital, they inform that the new service offers high security and high yield. High security because it will be storing the funds with Gemini and high yield because the interest rate ends up being 6.3% APY. If users deposit Bitcoin, they receive their funds in Bitcoin.
BlockFi is working so as to create products that allow crypto investors to do more with their digital assets. The BIA offers a service that does not require users to hold or purchase an ICO Token and there is no need for long fund lockups.
According to Anthony Pompliano, the BIA product has already been in private testing for several weeks and there are more than $10 million already deposited by retail and also institutional investors.