A new cryptocurrency deposit account has launched that pays 6.2% annual interest. The platform gives investors another way to grow their capital with crypto.
The new BlockFi Interest Account from crypto startup BlockFi pays 6% annually on a monthly basis. With compound interest, the total annual yield rises to an impressive 6.2%.
Announced earlier this week, the product is one of the first of its kind to offer investors access to compound interest. The firm’s co-founder believes it is, “one of the most powerful tools in finance”.
The account accepts deposits in BTC and ETH, and is open to investors from around the world. Funds can be withdrawn at any time. Gemini Trust also holds the funds in custody, the regulated custodian service founded by the Winklevoss twins.
The product bears many of the hallmarks of a crypto savings account. However, co-founder Brad Michelson said the cryptocurrency deposit account does not benefit from the same government deposit guarantees as a mainstream account.
Nonetheless, the high yield and access to compound returns means the product will appeal to investors keen to grow their capital. With the help of crypto markets, of course.
As well as investing in cryptocurrency directly, BlockFi plans to lend in crypto. Depositors will subsequently receive interest rates above the rate of interest.
Earlier this year, BIA launched in beta. Furthermore, it has already attracted deposits totaling $10 million.
The account is now available to customers worldwide, and provides another option for crypto investors to grow their wealth.
BlockFi raised $4 million to deliver its next wave of services back in December. In the process, securing the backing of notable crypto investors, including superstar investor Mike Novogratz and his Galaxy Digital Ventures. This comes in addition to the $55 million raised by the firm over the last year.
Needless to say, the firm aims to become one of the leading destinations for cryptocurrency banking and investment services.
The account is the latest example of an innovative financial service tied to cryptocurrency. The development comes at a time of increasing interest from institutional investors and the mainstream financial world.
Crypto markets currently still remain too volatile for many institutions to invest directly. However, products like the BlockFi account allow a more indirect exposure to movements in markets like bitcoin.