Home Cryptocurrency BlockFi Review 2022 – Is It Safe & FDIC Insured?

BlockFi Review 2022 – Is It Safe & FDIC Insured?

by edward

When looking at possibilities to buy, store, trade, and use cryptocurrencies, the options available are seemingly endless. Knowing where to start with crypto can become a daunting experience. A fact that is especially true when it comes time to decide how to store your crypto and how best to make your digital assets work for you. BlockFi is a solid place to start for a number of reasons. Lets explore them.

Why Get Involved In Cryptocurrency

If you are wondering whether you should get involved with cryptocurrency, you will find plenty of reasons. Crypto has taken the world by storm and digital assets of many forms are now being adopted at an institutional level the world over, for one thing.

In addition to the institutionalization of currently available cryptocurrency options, governments around the globe have begun developing cryptocurrencies of their own. Another attraction to cryptocurrencies is that each of the digital currencies on offer today seek to solve obstacles with the current State fiat currency systems that we all know so well. Some digital assets are created to increase anonymity, while others are designed to facilitate lightning-fast global asset transfers. You will find a crypto coin or token for virtually every use-case scenario you can imagine. Then of course comes making money with them as an investment. The most obvious reason to get involved.

Who Is Blockfi?

BlockFi is a company focused on providing traditional financial services for users within the digital asset space. Starting in 2017, BlockFi was the first financial company of its kind and it is still regarded as an industry leader. Among BlockFi’s many services are fiat loans, crypto trading, and high-yield digital asset savings accounts. As of 2022, BlockFi also began rolling out its Visa credit card which provides rewards in BTC. The range of services and benefits offered by BlockFi, as well as the fee schedule for said services and products, all create a one-of-a-kind experience that is hard to match.

How To Earn Interest On BlockFi

Earning interest on digital assets within BlockFi is a huge part of the draw for many of the company’s customers. The annual percentage yields are high in comparison to traditional savings accounts. This makes longer term savings plans more attractive for many.

To earn interest on any of the available products on offer, all that is required is to deposit funds into the account type of your choice. Depending on your choice, you will receive a product specific APY (all of which are clearly sated and transparent). In general, the highest interest rates are offered on Stablecoins like BUSD, USDT, USDC, and GUSD. Interest rates offered for stablecoin interest accounts range from 8.6% to 9.3%.

Flexible Interest Payments

The Flexible Interest Payments offered at BlockFi provide additional control over how your digital savings are allocated over time. After opening a BlockFi Interest Account users are given the choice for where and how the monthly interest payments are paid out. For example, when you open an interest-bearing savings account for your BTC, you can choose to have your interest payments from BTC (Bitcoin) go into any of the other asset options. This feature is helpful for users who would like to create a separate savings account which compounds over time.

BlockFi’s Tiered Interest Structure

A couple things to note when it comes to how much interest can be earned on digital assets is that interest rates are subject to change over time, and the BlockFi tier system which controls the interest amounts.

The possibility of APY rates changing over time is to be expected and a fact that exists in every financial service. It seems that rates will remain competitive for a long time to come, however. The tiered interest structure is tied to the quantity of the asset being held. This is likely a measure taken to protect the company from being taken advantage of.

For example, when you deposit less than 1 BTC, a 6% APY is applied to the account. From 1-20 BTC, an APY of 2% is offered, and an APY of 0.5% is offered to interest accounts with over 20 BTC. ETH (Ethereum) shares a similar structure. Up to 100 ETH, an interest rate of 5.5% is offered. 2% for accounts with 100-1000 ETH, and 0.5% for accounts with over 1000 ETH.

How To Get Loans On BlockFi

Apart from the high-yield interest accounts, crypto-secured loans are one of the primary features offered by BlockFi. Getting a loan on BlockFi is a simple three-step process.

The first step is to create an interest account with BlockFi. As part of that process, you will need to verify your identity, and decide on a funding option. Options to fund include wire transfers, ACH connections (in the US), and crypto wallet transfers from other platforms.

Once funded, users may use their US dollar balances to purchase the crypto of their choice. Keep in mind that your digital asset choice should coincide with the assets included in the loan program. Loans can be backed by BTC, ETH, and LTC.

Next, the application for the loan is filled out. This is where borrowers can decide on the loan amount (may be 50% of the value of the collateral) and which of their digital assets they would like to use as collateral for the loan. The application is also where fee and interest rate information is given. You will notice that an origination fee of 1-2% is applied to the cost of the loan and an APR of as low as 4.5%. The application only takes a few minutes and getting your loan funds can take as few as 90 minutes.

Coins Available On BlockFi

The list of coins available on BlockFi is not exactly expansive but does provide investors with a few solid options to choose from. Choices range from the big names in the crypto space (i.e. Bitcoin and Ethereum) to popular stable coins with values tethered to the US Dollar.

BlockFi Coins:

  • BTC
  • ETH
  • LTC
  • GUSD
  • USDT
  • PAX
  • USDC
  • PAXG
  • LINK
  • BUSD
  • DOGE
  • BAT
  • UNI

Benefits To Using BlockFi

For many, BlockFi is one of the most attractive platforms available when it comes to benefiting from, and taking part in, the world of digital assets. Whether you want to trade, store, or utilize BlockFi’s services to secure a loan, the platform comes with more benefits than most other digital asset solutions on the market today.

Trading: If you are interested in trading between major crypto pairs, BlockFi offers a fast and simple solution to make that a reality for you.

Loans: If you already own crypto assets and would like to leverage your digital asset holdings to secure a loan, BlockFi is one of your best options.

High APY Rates: Finally, because of the high APY interest rates, BlockFi is a fantastic choice for hodl’ers looking to invest in digital assets over the long term.

Final Thoughts

For serious investors and newcomers to the crypto space alike, BlockFi’s suite of features and services provides a one-stop-shop that makes taking part in the world of crypto a simple process.

The high-yield, compounding interest, the potential to leverage crypto holdings to make large purchases via the loan program, and the ability to utilize the services as a cloud-based crypto wallet and trading platform, all make BlockFi a wise choice. You can get started with them by clicking here.

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