BlockFi is the future of finance. The old way of doing things doesn’t cut it anymore. With BlockFi, you can use cryptocurrency to earn interest at up to 8.6% APY, borrow cash, and buy or sell crypto. There are no hidden fees, no minimum balances, and no reason to wait. With a BlockFi Interest Account (BIA), your cryptocurrency can earn up to 8.6% APY. Interest accrues daily and is paid monthly. With BlockFi Trading you can buy, sell, or exchange a variety of cryptocurrencies at competitive prices and start earning interest the moment your trade is placed. BlockFi offers best-in-class client service and support, plus leading protection measures to ensure you have peace of mind.
How you make money
The BlockFi Interest Account enables individuals and companies that own cryptoassets to earn interest in crypto on their crypto held at BlockFi. 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 your annual yield.
How BlockFi makes money
BlockFi generates interest on assets held in Interest Accounts by lending them to trusted institutional and corporate borrowers. To ensure loan performance, BlockFi typically lends crypto on over collateralized terms (similar to the structure of their crypto-backed loans). BlockFi also charges withdrawal fees. BlockFi offers one free withdrawal per client per month. After that, their primary custodian Gemini passes on a withdrawal fee of either 0.0025 BTC or 0.0015 ETH.
Is it safe?
When clients send crypto to their BlockFi account or purchase additional crypto within the BlockFi Interest Account, that digital asset is replaced with an obligation to return the same amount of that crypto plus any interest earned. In order to pay clients crypto interest on a monthly basis and to meet withdrawal requests on a timely basis, they engage in a number of activities, including (1) keeping a material amount of digital assets available for withdrawal with third parties such as Gemini, BitGo, and Coinbase; (2) purchasing, as principal, SEC-regulated equities and predominately CFTC-regulated futures and (3) applying risk management to the lending activities in the institutional market. The credit risks to these institutions are mitigated by credit due diligence and/or collateral (such as cash, crypto, or other assets).
BlockFi implements very thoughtful risk management practices and technology to mitigate the risk, but you should not view the BlockFi Interest Account as a savings account or brokerage account with FDIC or SIPC insurance. Digital currency is not legal tender, is not backed by the government, and the BlockFi Interest Account (BIA) is not a bank account nor a brokerage account. It is not subject to FDIC or SIPC protections. Investing in cryptocurrencies involves a high degree of risk and is not suitable for many investors.