Before you start making use of Blockfi, make sure you go through this Is Blockfi review to know if it is safe or not safe to use.
BlockFi, a cryptocurrency platform and exchange, offers crypto trading, crypto trading, crypto loans and a rewards credit card. Non-US customers may also open a BlockFi interest account to earn interest on their assets.
BlockFi also allows you to borrow against your coins. You can borrow against your coins instead of having to sell them when you have the funds.
BlockFi offers interest earning opportunities. You can earn up to 9.0% interest by opening a BlockFi Interest Account. All you have to do to get your money is deposit through BlockFi. You will also have the chance to earn interest with certain other features.
To gain access to these services you will need to be familiar with the fees. You need to be aware of the details about whether these fees are fixed or variable. You’ll be able to make the right decision.
Blockfi review 2022: How does blockFi work?
The company’s old Interest Account was a spread-based business that made money by borrowing capital at a specific rate (the interest it pays to users) and lending it capital at a higher rate (“the interest rates it offers for BTC/ETH/GUSD loans). BlockFi’s blog notes that the company works primarily with institutional counterpart parties to provide liquidity. These borrowers include:
Investor funds and traders looking to arbitrage trading opportunities in a fragmented market. To close price gaps between dispersed markets or exchanges, they borrow cryptocurrency. Margin traders borrow cryptocurrency to fund their trading strategies.
Market makers who connect buyers and sellers over the counter (OTC), often at a high mark-up, do not prefer to transact on public exchanges. To meet the demand, these parties must keep enough cryptocurrency inventory. OTC market makers can borrow from BlockFi lenders to meet their financial needs, as cryptocurrency ownership is capital-intensive and carries the risk of price volatility.
Businesses that require a large inventory of cryptocurrency for their clients include cryptocurrency ATMs, which keep the majority of their assets in cold storage but still need liquidity to operate on a daily basis.
BlockFi makes money today from the spread of assets on its platform, interest on its loans and other schemes that it offers with its credit card accounts.
Pros:
- Ability to borrow against crypto.
- Wide range of crypto trading pairs.
Cons:
- Services may not be available in all states.
- High withdrawal fees.
Blockfi Interest Rate
With the BlockFi Interest Account, you can earn compound interest of between 3% to 8.6% on your cryptocurrency holdings. There are no hidden fees or minimum balance requirements.
Is Blockfi Safe?
BlockFi is safe, and investors around the world can access it. While you have the right to withdraw your assets at any time, there is a limit of one free withdrawal per month. BlockFi funds are held by Gemini Trust, which is then regulated by the New York Department of Financial Services.
- Blockfi vs coinbase
BlockFi and Coinbase, both based in the United States, offer crypto exchange services. BlockFi is privately held, but Coinbase is listed on the stock exchange under the ticker symbol COIN. Both allow investors to trade cryptocurrencies and both can be bought and sold. However, BlockFi functions as a cryptocurrency bank.
Coinbase is the clear winner when it comes to choice. Coinbase offers 150 cryptocurrencies for U.S.-based investors. There are many options available, including DOGE, BAND and BCH.
BlockFi, however, only supports eight coins: BTC and ETH, LTC; USDC; USDT; GUSD; and PAXG. You can’t buy PAX, PAXG or GUSD on Coinbase. BlockFi does not support fiat currencies. Instead, it converts your wire transfer or bank transfer into GUSD. Coinbase allows cash deposits as well as over 20 fiat currencies such as USD, EUR and GBP. Users can also purchase coin fractions on both platforms.
Coinbase is known for its ease of use for new users. Its large knowledge base includes tutorials and tips. High ratings are given to the mobile apps for their usability. The platform is intuitive and simple to use for most people.
BlockFi is also an easy-to-use platform for beginners. The website and mobile apps are easy to use for first-time investors. BlockFi provides advice on buying a car and understanding loan terms, instead of focusing solely on crypto learning.
Blockfi Withdrawal Fees
Although it does not charge withdrawal fees, BlockFi charges a fee for withdrawing funds. Keep in mind that the amount you pay will vary depending on which crypto you use. You will find the currency in the crypto you’re trying to use.
Keep in mind, however, that each cryptocurrency will have a withdrawal limit regardless of how much you pay. These withdrawal limits will be in effect for 7 days. These are the withdrawal fees you should be aware of:
Bitcoin: 0.00075 BTC fee and a 100 BTC withdrawal limit
Ethereum: 0.02ETH fee with a limit of 5.000ETH withdrawal
Chainlink: 0.95 LINK Fee with a 65,000 LINK withdrawal limitation
Litecoin – 0.0025 LTC Fee with a 10,000 LTC withdrawal limitation
Gemini USD Coin/Tether: $10.00 USD Fee with a $1,000,000 limit
Basic Attention Token: $35 BAT fee with a 2,000,000 limit
Uniswap – 1 UNI Fee with a 5,000 UNI withdrawal limitation
These are the average withdrawal fees. However, users should know that they can withdraw one time per month for free. If they stay within the monthly withdrawal limits, they may not have to pay any withdrawal fees. A person who withdraws 1 Bitcoin per week might pay more than someone who withdraws 4 bitcoins per month.
Blockfi vs Celsius
You can compare the features to help you decide which platform is best for you. Let’s take a look at what each platform has to offer.
Interest Rates
BlockFi offers its users the opportunity to earn interest via stablecoins, Ethereum and Bitcoin, Litecoins, PAGX, BAT and Uniswap. Stablecoins may earn as high as 7.5% annually, while other cryptos usually earn between 1% to 5 %.
Celsius has a similar selection of cryptos but the interest rates might differ. Stablecoins can earn around 8.9% interest. Traditional coins can earn between 2 and 11% depending on their asset.
Celsius offers savings accounts with the highest average interest rates. The floating interest rate of Celsius is technically a floating rate. This means that the rate can change as the cryptocurrency’s value increases or decreases. The interest rate will be determined by the asset. The interest rate is stable over time because of this.
Withdrawals and Payouts
Celsius allows users to withdraw at no cost. Withdrawals are free of any origination fees and fees. You can withdraw as many times per month as you like, and there is no withdrawal fee. You don’t have to withdraw a minimum amount.
BlockFi allows you to only make one withdrawal per month. This applies regardless of how much Bitcoin you have. There are also restrictions on withdrawals. You can only withdraw a specific amount depending on which type of coin you are withdrawing or paying. BlockFi charges fees depending on which type of Bitcoin you wish to withdraw.
Celsius seems to perform better than BlockFi in terms of withdrawals and fees. Users can save money by not having to pay withdrawal fees and get the most from their investments.
Security
Both BlockFi and Celsius are secure. Multiple security features will stop unauthorized users entering your account. Both platforms offer 2-factor authentication. This requires that you also connect your phone to your account. This feature is highly recommended to ensure safety.
Both platforms offer methods to ensure that crypto money doesn’t end up in unapproved places. BlockFi, for example, allows you to select which wallets you want to send your cryptos to. This will protect you from money theft and loss since you can only send cryptos to wallets that you own.
The HODL mode, which is similar to Celsius’s security measures, is also available. This will also prevent unauthorized transfers. The HODL mode temporarily blocks your account from sending funds outside of the platform. This means that if someone hacks into your account, they will not be able to send the money to any other place. After 7 days, the temporary restriction will be removed and you’ll need to activate it again.
This restriction does not prevent unauthorized persons from sending funds. It only applies to you. HODL is a great way to protect your investment funds, even if you don’t intend to make any. If you want to preserve your money so they earn interest, it’s a great option.
Conclusion
After going through this Blockfi review, we can say that blockFi is a safe, user-friendly cryptocurrency platform with many features and advantages. Overall, we highly recommend it to anyone looking for an easy and efficient way to invest in cryptocurrencies.