I stumbled across this concept while trawling through my Twitter feed (yes I’m active on Twitter, follow me there!) – The idea of earning interest on Bitcoin is simply too good to pass up. After tinkering around, I am sharing with you how to earn interest on bitcoin or any other crpytocurrency for that matter to massively compound your wealth.
What is BlockFi?
Basically BlockFi is one of the many cryptocurrency lenders. They offer crypto interest bearing accounts which means you can deposit your cryptocurrency with them and earn interest on that crypto, much like how you earn interest on your savings account. It might offer an interesting choice to squeeze a little bit extra performance from your assets.
BlockFi is a fintech based out of New York and has attracted quite a bit of institutional backing from the likes of Valar Ventures, Galaxy Digital, Fidelity, Akuna Capital, SoFi and Coinbase Ventures (all VC / institution juggernauts). I’ve read a bit on BlockFi, and their founder profiles all check out.
What’s most important is that they spare no expense when it comes to security. Their custodian is Gemini which uses very advanced security protocols to safeguard your BTC. What’s more, Gemini is a New York trust company regulated by the New York State Department of Financial Services.
Earn Interest on Bitcoin
Here’s how to earn interest on Bitcoin:
- Sign up with BlockFi
- Transfer your BTC to BlockFi
- Let it sit there and earn you interest up to 6% annually.
How can BlockFi pay you? Generally, cryptocurrency lending (or DeFi lending – Decentralised Finance lending) means cryptocurrency owners lend money to borrowers at a certain interest rate, just like banks. These platforms then connect the asset owner to borrowers and make a percentage commission in between.
What’s the downside risk?
Losing your Bitcoin is entirely possible. So I would advise against putting ALL your Bitcoin onto these interest-bearing accounts. They’re good for compounding a portion of your Bitcoin assets, but as with all things – don’t put all your eggs in one basket.
Hacks and massive thefts can still happen, though I trust that Gemini’s security is world-class enough to prevent these attacks.
If you want to try letting your Bitcoin compound effortlessly, you may try BlockFi interest bearing accounts and earn interest on your Bitcoin. It’s a wonderful way to get extra interest on your assets to help you build your wealth slowly over time.