Examining High-Interest Yields and Low-Interest Crypto Collateral Loans
If you are like me, you’re frustrated with the poor devaluation of the US dollar. You’re furious by the insulting savings account rate of maybe 0.03% APY. Plus you want to protect your money and learn what many institutional investors and thousands of normal people have begun doing, especially this year (December 2020), and will continue to for decades to come. You are ready to profit with an incredible passive income stream: High Crypto Interest Rates up to 8.6%-10% or more. This article has the solutions that will not only get you excited but have the potential to be life-changing information as long as you don’t delay.
Let’s examine how exactly I protect my wealth.
How to protect your hard-earned money with high-interest rate platforms
Protecting your money should be priority #1.
The reason Bitcoin even exists is to do exactly what it is doing right now. Protect against the devaluation of our dollar (hedge of protection), wage war against traditional greedy banking systems and their power by using decentralized banking. This enables you to avoid astronomical fees hidden fees and grow your personal wealth at the same time!
For example: If I held my money in a traditional savings account I am actually losing almost 8% of my dollar strength every year.
DISCLAIMER: The information contained herein should not be considered financial advice or construed as financial recommendations to buy, sell, or hold a cryptocurrency. These are only my personal experiences and should only be considered educational. These opinions are my own and will not be held liable for the companies I recommend others look into or the cryptocurrency market in general. Investing in crypto can be considered high risk. My opinion (backed by statistics), however, is that the dollar is an even greater risk. Also, many links on this page are affiliate links which means I may receive a commission at no additional cost to you. It helps support our blog and expenses.
Let me explain.
That being said, JP Morgan Chase as of December 28, 2020, released a memo stating that they believe Bitcoin is likely to see $640,000 by 2022-2023. I’m buying Bitcoin:)
US Dollar Index Devaluation and Inflation Have Reached a Combined 7.7% in 2020!
Inflation comes in at roughly 3% and the dollar as of December 2020 has lost 4.7% of its value just this year alone.
This means by just holding your money you are losing 7.7% of your spending power each year!
At the time of this article, Bitcoin has just topped an all-time high of $28,400 which is a yearly gain of over 280%.
So, I have been accumulating Bitcoin since 2010. Using my methods I teach you in this article, I also earn an additional 6% APY Bitcoin which turns my 6% earnings into an additional 280% gain (roughly obviously) on every dollar I earn throughout the year. Kind of a flipping cool deal.
My main goal is to acquire more Bitcoin.
The question I asked was: How do I get more Bitcoin without having to buy more Bitcoin with my own capital?
The methods I share with you are an incredible and passive way to do this.
Let me explain 3 of my #1 choices to save and earn passively.
Banking on Bitcoin with High Yield Interest Rates up to 12%
Competitive interest rates that allow you can top up Bitcoin, Ethereum, USDC coin, and 16 other cryptocurrencies are the main goal of the highly vetted, secure, US-based or SEC-approved #1 loan and crypto banking recommendations I will show you.
The moment you add any of those crypto assets, they will land in your savings wallet and allow you to earn daily interest. And get this, your interest compounds at the daily rate (or monthly rate depending on platform) specific to each cryptocurrency! Let’s look at how this works.
How to earn compound interest with Bitcoin?
No strings attached with our recommendations in this article. Regular traditional savings accounts might pay 0.03% on your savings and pays out monthly (OOOFF!).
The main coin that pays the highest interest rate is called USDC stablecoin. It’s perfect for decentralized finance. The advantage is that the traditional bank does not control it. Your loans, your money, your terms. Centralized Finance is being buried as we speak and you’re on the front lines!
If you haven’t heard of USDC stablecoin, this is basically a USD coin that is dollar for dollar. It is considered high yield savings using this method. It is a market coin, however, but maintains its value much better than our actual US dollar. More to come on that.
So your coin holdings are $1 fiat currency = 1 USDC.
Did you know you can earn 8.6% on USDC at BlockFi? Start an account today and get a bonus of $15-$250 in FREE Bitcoin!
Here’s an overview of our top 3 Crypto Lending Platforms before going in-depth:
Let’s look at my top 3 picks which work wonders for beginners to advanced traders and are have stablecoins that pay awesome.
#1 Recommendation: BlockFi High-Interest Rate Exchange, Loan Services
BlockFi is Rated #1 because for the following reasons:
- Excellent for beginners or advanced investment persons
- Pays monthly interest and therefore compounds, monthly.
- Offers great rates as well (8.6% APY USDC or GUSD), 5.5% APY Bitcoin (these may fluctuate slightly), and Ethereum 5.5% APY.
- Is located in Jersey City, New Jersey USA, and SEC approved
- Offers loans using your crypto as collateral but the process is not as easy. Save on taxes (HUGE) and enjoy the markets because you don’t have to sell it to use it as a loan!
- Must do KYC process which meets strict US laws.
- Does have ACH transfer (link your checking account) and works much like an exchange (huge positive).
- Allows direct purchase of crypto but their market price is generally $200-300 more than another exchange. They don’t have a “fee” but there is certainly some arbitrage that occurs.
- Very Secure: Withdrawing and depositing are pretty easy with 2FA and Google Authenticator app but BlockFi is very careful with transfers. You may experience added layers of security checks. Don’t be upset. They are ultimately protecting your money!
#2 Recommendation: NEXO High-Interest Rate Bitcoin, Ethereum, Litecoin, Ripple USDC, and more
- Pays daily interest which compounds…every single day.
- Is not an exchange so you must buy NEXO tokens and hold at least 10% of your portfolio balance to receive the Platinum level. You can add Bitcoin, Ethereum, USDC from another platform and transfer your crypto into NEXO
- Offers USDC is up to 12% APY (non-USA citizens only) and 10% to US users. Bitcoin is at 6% APY a day!
- If you hold Ethereum, with the NEXO service you receive 6% APY.
- Say you have $10,000 USDC at 10% APY (US citizens), that is $1,000 in interest alone!
- Has a $100 million dollar insurance policy for their customers
- Extraordinary crypto Loans that are super easy, best loan interest rate using your collateral is 5.9%
- Is USA SEC approved and vetted and based in Switzerland
- Must do KYC process meeting strict US government laws
- No ACH transfers (you cannot deposit any dollars from your checking account into NEXO) except that you can pay back your loan using US dollar or your collateral.
- Very Secure: Withdrawing and depositing are very easy with 2FA and Google Authenticator app.
Let’s look at my 3rd recommendation.
#3 Recommendation: Coinbase High-Interest Rate USDC only
- Coinbase is the oldest and most popular cryptocurrency exchange in the United States
- Offers 1.5% on USDC and zero on Bitcoin for your cryptocurrency wallet.
- Allows ACH transfers, credit cards (as with any credit card, high fees apply and are not recommended).
- Allows you to trade Bitcoin, Ethereum, Litecoin, USDC, and dozens of altcoins to add to your portfolio should you choose to.
- Limited interest rate payouts. Coinbase is primarily a place to buy and sell crypto.
Best High-Interest Rate Final Recommendations
FINAL recommendation: I do recommend BlockFi as our #1 pick for beginners and you can easily move your crypto over to NEXO from there.
And there you have our Top 3 recommendations. The remainder of this article will focus on a more in-depth study of the platforms and how you can begin using them today.
For the purpose of explanation, I’m going to use NEXO as our main example platform to demonstrate different options. BlockFi, NEXO, and Coinbase all operate similarly but differently and most of the time it’s just easier to open an account and go for it rather than reading a 5,000-word article. You’re welcome: ).
Loyalty Levels with NEXO Means greater Returns for Users
NEXO is a genius for doing a leveled payout approach. It is creating not only price stability in the NEXO token, but NEXO has also purchased $10 million of their own coin and is holding it to help the entire stability of the coin!
The NEXO loyalty program looks like this:
What are High Yields for Cryptocurrency Companies on your Active Deposits?
High Yields is simply earning way more than traditional savings accounts like at Capital One which is a complete joke at 0.04%APY! Unreal. Here is a brief overview of what a yield on cryptocurrency would look like:
Yields on cryptocurrencies range from about 4% to 12% or more. This is significantly more than the yields on traditional savings accounts This is because crypto banks cannot “produce money supply,” so they have to attract investors with high yields. The supply and demand for crypto financing driven interest rates.
Your bank savings account comes with $250,000 of FDIC insurance.
But there won’t be any federal insurance offered on a crypto-based savings account. You can lose money (or crypto) in this savings account. So you should think of it more as an investment rather than a savings account.
Crypto Savings Accounts Vs. Regular Savings Accounts
What are the main differences between a crypto-based savings account and a regular savings account? Here are a few things that set them apart.
Bitcoin Lending Rates – Compare Bitcoin Interest Rates 2020
Bitcoin Lending Rates
Perhaps the biggest trend regarding Bitcoin in DeFi has been the number of new products geared at bridging Bitcoin and Ethereum.
Best exemplified by Maker and its recent support for wrapped Bitcoin (WBTC) which has fueled the creation of Dai, DeFi is seeing strong signals that more Bitcoin holders are looking to port their assets over to the industry-leading smart contracting platform.
Can I get a loan with these crypto investment banks?
Absolutely. In fact, companies that are making absolute strides #NEXO token has risen from a January 1st, 2020 price of $0.09 to a high of $0.72, a 700% gain in 12 months. #TSLA experienced a 600% gain this year (2020). Bitcoin on average experienced a roughly 225% gain (at the time of this writing).
What does this have to do with getting a loan? Well, many of the investment banks rely on their own crypto to support the ecosystem of the bank. It creates loyalty, stability, and the ability to raise money for the company and its customers.
Using NEXO as our example, maintaining a 10% NEXO coin balance in your account against your other assets allows you better rates with both loan and high-interest rates for your account.
If I have 1 bitcoin worth $10,000, I need to have $1000 (value) of NEXO in my account to get the incredible 5.9% APY NEXO loan rate.
How to borrow money from NEXO
Continuing with NEXO as our example here is How to borrow with Nexo. The NEXO crypto banking account offers the easiest, most secure, and flexible instant rates for lending. Crypto credit lines with interest rates, starting from just 5.9% APR.
The amount of credit given to you is based on the crypto deposits you add, the market price of your custodial assets, and the crypto loan you need. Holding Bitcoin or Ethereum would be great examples of volatile rate variance in the market price, but good options overall.
I will show you how to borrow with a NEXO credit line, how to manage your credit line, and how to repay, how to borrow just create your next account and top up your Nexo wallet with digital assets.
How to Top Up your Crypto Currencies on most crypto lending platforms
Once you deposit funds, at the same time, a credit line becomes instantly available. A
As you can see from the video, crypto lending is extremely easy. Your credit line equals 50% of the real-time market value of the Bitcoin and ether you have added.
As for the other crypto assets, this percentage might be higher or lower depending on their risk levels. Now, you can instantly borrow as little as $10, and as much as $2 million.
There are no credit checks required and no fees imposed to borrow the only fee, you will pay is the interest rate on the amount borrowed, you can borrow your full credit line amount right away, or you can borrow multiple small amounts until you reach your credit line limit.
You could borrow Fiat in more than 40 currencies that can be sent to almost any country and normally will reach your bank within a business day. You can also borrow stable coins, which will instantly reach your crypto wallet (online), allowing you to buy more crypto.
Lastly, credit lines not only let you maintain ownership of your digital assets and their upside but also let you save on your capital gains taxes. You don’t have to sell your crypto to use your crypto and more importantly – lose out on the amazing gains Bitcoin is presently doing in 2020 and into 2021!
Now that you have an open credit line let’s examine why it is important to manage it properly so you get the most of your assets.
How to manage your credit line terms
Nexo or BlockFi gives you full flexibility to use one, two, or more assets as collateral for your credit line to select your collateral assets, simply transfer them to your credit wall. Any remaining funds in your savings wallet will be earning daily interest. Note: Your Savings Wallet is not a digital wallet or decentralized application like that of Trezor wallet. But there is not any transaction fee to use it. If market capitalization occurs, keep reading to understand what happens if you do not pay your credit line back in a timely manner.
What’s more, when the value of your collateral assets increases the amount of your credit line automatically and instantly grows as well. This lets you get the most of your funds, go ahead and immediately borrow more, or alternatively, grow your passive income by moving the excess collateral to your savings wallet.
Are my Bitcoin and cryptocurrency secure?
Security is crucial for Nexo, BlockFi, and its clients. That is why to maximize the protection of your assets Nexo gives you the tools to secure your assets, even under extreme market conditions.
For example, if your collateral starts to quickly depreciate, the net sells Oracle will send you an email encouraging you to repay your credit line or to add extra collateral. If you don’t do so, the Oracle will automatically move assets from your savings wallet to your credit wallet, to increase your collateral.
And in case you don’t have assets in your savings wallet, Oracle will use small portions of your collateral to initiate automatic loan repayments that are just about enough to cover the maintenance margin.
The easiest and safest way to fully protect your collateral is to simply add as many funds as possible to your savings wallet. That way, not only will you minimize the risk of losing any collateral, but you will also earn interest on your idle funds.
How to repay your Cryptocurrency credit line loans?
When you decide to repay your credit line, you can do so by using the cryptocurrency stable coins or fiat currencies available in your savings and credit wallets, in case you don’t have enough funds in your account just top it up. You can also repay by using an Ethereum token, for example, to repay your amount if you choose.
Adding cryptocurrencies or stable coins takes mere minutes and adding Fiat normally takes one to three business days. The awesome thing about decentralized finance is that transferring a stable coin takes literally seconds, unlike a traditional bank!
Once your funds are inside your NEXO or BlockFi account, just make a repayment. Please note that you have the full flexibility to partially or fully repay your credit line, whenever you like.
Unlike other borrow products NEXO sets no minimum repayment requirements, you can keep your credit line open for years, as long as you have enough collateral to secure your outstanding loan, it’s time to get the most out of your digital assets, move them to your secure NEXO wallet, start earning passive income and get instant access to cash and stable coins, whenever you need them. BlockFi requires payback within 1 year.
What Would I do If I was Starting with Crypto today?
What Are the Quickest Steps to Begin Earning with BlockFi?
Topics highlighted in this Issue:
- Top Pick for Bitcoin Lending in 2020
- Bitcoin Lending Platforms in 2020
- DeFi Bitcoin Lending Platforms
- Bitcoin in DeFi
- Why are there no DeFi lending platforms native to Bitcoin?
- Can I borrow Bitcoin too?
- Should I lend my unused Bitcoin?
- Is My Bitcoin Safe?
- How to keep my Bitcoin Secure
- With over $100M in funding according to Crunchbase , BlockFi is backed by industry giants like Coinbase Ventures and Winklevoss Capital.