Are you a native crypto user? Or do you want to invest in digital currencies? If so, you’ve probably heard of BlockFi, one of the most popular exchanges in the industry.
BlockFi’s website offers institutional financial products for the cryptocurrency market. These institutions include market makers, hedge funds, and more.
What do these institutions have in common? They want to invest in cryptocurrency but cannot get the financial support they need from traditional banking institutions.
BlockFi has been affected by the FTX scandal and have paused all withdrawals.
Get up to a $250 crypto bonus with a deposit into your BlockFi Interest Account (BIA) Find out more using the link below
Fortunately, BlockFi strives to bring affordable and simple applications to institutional clients to maximize the potential of cryptocurrencies. That said, they offer impressive returns for people looking to open a cryptocurrency savings account.
In this BlockFi review, we’ll take a closer look at this amazing fintech company and how it continues to redefine and reshape lending for digital assets.
What is BlockFI?
BlockFi is a cryptocurrency depository that allows its clients to borrow USD in exchange for their cryptocurrency. The founders are Flori Marquez and Zach Prince. BlockFi was founded in August 2017 and is headquartered in Jersey City, New Jersey. The company raised $ 158.7 million for the C Series.
“We are at a very early stage in this sector and we are all working together to develop the market and make it available globally,” Prince told Crunchbase. “We are fortunate to be in a situation where our company is growing rapidly as the cryptocurrency gains momentum and importance.”
Nowadays, more and more users are using BlockFi as a bank for their cryptocurrency. Just like you use Bank of America or a credit union for your fiat currency, you can use BlockFi for your cryptocurrency.
When it launched, BlockFi primarily focused on its BlockFi Interest Account (BIA). With the help of BIA, cryptocurrency users can deposit money on the platform and then earn interest on their assets. People are paid to borrow money from BlockFi and the system generates stable income for users.
Today, BlockFi has further expanded its products and services. For example, BlockFi also offers crypto accounts in addition to cryptocurrency trading.
The future of BlockFi looks bright. The platform aims to bring the world’s first Bitcoin reward credit card to market soon. With this card, you get 1.5% Bitcoin on every purchase.
BlockFi has just filed the BlockFi Bitcoin Trust with the SEC, according to a new report on Jan.29, which suggests the company is developing new creative investment products.
Overall, BlockFi’s goal is to help you “do more with your cryptocurrency.” Let’s take a closer look at how the platform works and how it can help you.
What products does BlockFi offer? This includes:
- BlockFi Interest Accounts (BIA)
- Trading Accounts
- Crypto-backed Loans
- Forthcoming Bitcoin Rewards Credit Card
Let’s dive deeper into each of these products and explain why consumers like you might like them.
BlockFi Interest Accounts(BIA)
This interest account contains coins that you have paid in or bought on the exchange. It works just like a traditional savings or investment account. One big difference is that money you deposit in a bank account is protected from bankruptcy for up to $ 250,000 with FDIC insurance.
Likewise, all funds in a broker’s account are protected by SPIC insurance. However, if you deposit your savings into a BlockFi interest account, you will not have this protection.
You are limited to one crypto withdrawal and a stable monthly withdrawal. After that, you pay a fee for each withdrawal. You can make automatic transfers to any bank account connected to Plaid, a company that allows applications to securely transfer data to and from your bank.
You can also set up a service or company account. It works the same with a BlockFi interest account, but it is in the name of the company. Additional documentation and a lengthy review process are required. Once you have submitted your application, a member of the BlockFi compliance team will contact you to assist you with subsequent registration.
It Pays these interest rates:
- Bitcoin (up to 2.5 BTC): 6%
- Bitcoin (over 2.5 BTC): 3%
- Ethereum: 5.25%
- REFERENCE: 5.5%
- PAX Gold: 5%
- Litecoin: 6.5%
- Standard Pages: 8.6%
- USD: 9.3%
- USDC, GUSD, and BUSD: 8.6%
Interest rates are subject to change*
Interest starts on the day after it’s deposited and is paid monthly.
BlockFi pays interest by lending assets to institutional and corporate borrowers with high collateral. It has reserves – so it can finance your results – with the New York Trust Company, Gemini, and other third parties.
BlockFi Interest Account is available to clients in most countries and all US states except New York.
Use the money from the BlockFi interest account to buy cryptocurrencies on the BlockFi exchange at no cost. They have daily trading limits based on the size and activity of your account.
To complete a transaction, simply log into your BlockFi account, enter the amount and currency of the purchase or sale, and authorize the transaction. You can make a one-time transaction or automate it to repeat daily, weekly, or monthly.
When you buy cryptocurrencies on the exchange, you end up in your interest account and start to earn interest immediately.
What’s the other cool feature of BlockFi? The relaxed liquidity of your crypto assets through its crypto-backed loans. Instead of downloading Bitcoin for quick money, you can borrow up to 50% of its cryptocurrency value from BlockFi.
Each loan is borrowed from your cryptocurrency balance at an interest rate of 4.5%. The collateral amount and interest requirements depend on the loan amount and the cryptocurrency you choose to secure your loan.
With these loans, you can expand and diversify your portfolio. How? Use your funds to invest in more digital assets.
The income you see may exceed your interest. As a result, it is a smart strategy to increase your wealth, optimize growth and reduce risk.
You will receive the loan the day BlockFi, as a customer, receives the required collateral. It’s too easy. And you can get your credit back at any time with no prepayment fees.
Upcoming Bitcoin Rewards Credit Card
BlockFi is in the process of launching Bitcoin Rewards credit cards and the waiting list is growing. The card will give you 1.5% Bitcoin returns on purchases.
When you sign up and use a BlockFi Interest account, you get access to the Bitcoin Rewards credit card waiting list. The card’s launch is slated for 2021 and will apply to U.S. residents in a limited number of states. Go here to access the waiting list.
How to sign up for a BlockFi Account
It’s easier than ever to create a BlockFi account. You can open a BlockFi Interest Account (BIA) if you are over 18 years old. Citizens of most countries can join BlockFi without any restrictions. BlockFi previously blocked users in New York, Connecticut, Washington, and the European Union. However, the company now appears to be allowing users in most parts of the world (except for US-sanctioned countries).
Step 1) Visit BlockFi’s Website or download the BlockFi app for iOS or Android.
Step 2) Enter your personal details including your name, email address, and password. If someone referred you to BlockFi, please enter your referral code. Accept the terms and conditions.
Step 3) Complete the KYC / AML process by reviewing your details and providing your identity.
Step 4) Click on the “Deposit” tab, then deposit funds into your account using cryptocurrency, bank transfer, or stable coin transfer.
Step 5) You will earn interest as soon as the funds are deposited into your account. Once the money has been deposited into your account, it can be used as collateral for your loan.
That’s it …! BlockFi is designed to be easy for everyone, even if you’re new to cryptocurrency. While all of this information sounds like a good opportunity, consumers don’t need to spend a lot of time signing up. If they are over 18, they can provide their legal name, email address, and password to create a new account.
Online registration is available for all products and services. Therefore, users should make sure that they are choosing the right product. Opening a BlockFi account is quick and easy and users can start earning interest right away.
Is BlockFi safe to use?
BlockFi has been affected by the FTX scandal and have paused all withdrawals. We do not reccomend sending deposits at this time!
The BlockFi website offers two-factor authentication and the site has never had a security issue to date. Not all assets are stored in BlockFi. Gemini Custody owns all digital assets on behalf of BlockFi. They use industry-leading cold storage solutions that are insured. BlockFi and Gemini Custody offer high-security standards for your digital assets.
How BlockFi mitigates risks
On March 12, 2020, after BTC fell 50%, the BlockFi business continued as usual. What enabled the company to weather this storm? Overcollateralization.
While many other companies are not actively lending, BlockFi has always been open. The company’s risk management system worked flawlessly. For crypto exchanges, the biggest challenge isn’t whether the risk system is working well. Rather, it is about offering the best possible customer service even in a volatile market environment.
The company goes one step further and builds strong customer relationships that go beyond the distance. BlockFi assumes that the platform will continue to grow and offer customers added value. The company continues to strive to attract and retain customers throughout their lives, which Prince says is much more important than just one day of operations.