Observer Content Studio is a unit of Observer’s branded content department. Observer’s editorial staff is not involved in the creation of this content. Observer and/or sponsor may collect a portion of sales if you purchase products through these links.
BlockFi is a crypto management platform that lets you leverage your cryptocurrency and put it to fair use.
At BlockFi, you can earn up to 8.6% interest per year on your cryptocurrency holdings, borrow cash, buy and sell crypto, and access other bank-like services. It’s like an all-in-one crypto bank.
The cryptocurrency industry is always evolving. Recent media attention has more consumers than ever pouring their money into various cryptocurrencies. In a sense, the days of Bitcoin’s supreme dominance over altcoins is over. Cryptocurrencies like the Binance Coin, Cardano, ATOM, and countless other alternative cryptocurrencies offer new users a better entry point for long-term financial gains. As demand for these altcoins continues to grow, so too does the need for reliable cryptocurrency accounts capable of producing interest for account holders. This is where BlockFi comes in.
The BlockFi website opens with the claim that its platform can help cryptocurrency holders to “earn more from your crypto.” Using a BlockFi account to store your crypto might allow you to earn “up to 8.6%” in interest every year. These kinds of rates are absurdly high, especially when we compare them to traditional bank accounts within the fiat financial sector. There was a time in history where 5-10% yearly interest rates were standard on U.S. savings accounts. Now? Most accounts don’t even offer interest capable of outpacing inflation.
BlockFi currently offers eight different cryptocurrencies. A number of benefits are associated with the platform, partly because BlockFi accounts tap into the power of cryptocurrency and decentralized finances. Account holders on BlockFi don’t pay hidden fees, they aren’t required to keep a minimum balance, and they can instantly transfer their funds out of the account.
BlockFi might make it possible for cryptocurrency holders to maximize their profits for holding the coins they believe in. Functioning as a new-age decentralized finance bank account, BlockFi brings to the crypto sector the kind of security and interest-bearing profits that investors in the traditional financial sector already enjoy. GUSD and USDC offer the highest interest rates, but even Bitcoin supposedly provides account holders with 6% interest each year.
New DeFi projects are popping up every year, and it’s sometimes hard for consumers to know which companies are worth doing business with. We’ve done the research into BlockFi so you don’t have to.
Let’s answer the all important questions like how does BlockFi work or should you use BlockFi for your cryptocurrency? Find out everything you need to know about the popular cryptocurrency interest-bearing account platform today in our review.
What is BlockFi?
BlockFi is a bank-like platform for crypto users. By depositing cryptocurrency into BlockFi, you can earn interest, spend your crypto, and buy or sell crypto with no hidden fees or minimum balances.
Today, a growing number of 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.
At launch, BlockFi focused mostly on its BlockFi Interest Account (BIA). With a BIA, Crypto users could deposit money into the platform and then earn interest in their holdings. People are paid to borrow money from BlockFi, and the system generated consistent profit for users.
Today, BlockFi has expanded its products and services even further. BlockFi offers crypto accounts, for example, along with crypto trading.
The future looks bright for BlockFi. The platform aims to launch the world’s first bitcoin rewards credit card soon. That card would give you back 1.5% in bitcoin on every purchase.
And, according to a new report from January 29, BlockFi just registered something called the “BlockFi Bitcoin Trust” with the SEC, suggesting the company has creative new investment products in development.
Overall, BlockFi’s goal is to help you “do more with your crypto.” Let’s take a closer look at how the platform works – and how it can help you.
BlockFi Products & Services
At launch, BlockFi was known as a bitcoin savings account platform. You couldn’t put your bitcoin into a savings account for many years, nor could you earn interest on your bitcoin holdings. You just held bitcoin, spent it as needed, and left it in your wallet.
BlockFi changed that with its BlockFi Interest Account (BIA) system. BIA allows users to borrow bitcoin or earn interest on their bitcoin holdings.
Because of these and other products and services, BlockFi continues to make a name for itself as one of the leading crypto asset management platforms available today.
BlockFi Interest Account (BIA)
Traditional bank accounts pay interest on your holdings. You earn a small return for keeping cash in your savings account, for example. That’s not the case with bitcoin, which does not have any centralized savings account or interest system.
That changed with the BlockFi Interest Account (BIA), which allows you to earn returns after depositing bitcoin, GUSD, Ether (ETH), or USDC into your account. You sign up for an account, fund your account with USD, crypto, or stablecoins, then start earning interest.
Once you fund your BlockFi account, you can do more with your money. You can buy a card to spend your crypto in the ‘real world,’ for example. You can earn returns, borrow money, and do more with your crypto holdings.
Borrow Funds Against Crypto Assets
BlockFi also lets you borrow funds against your crypto assets, paying as low as 4.5% APR while withdrawing US Dollars.
Many crypto users like holding their crypto. They don’t want to sell. With BlockFi, you can use your crypto holdings as collateral. You maintain access to your crypto while getting a loan in USD.
As of February 2021, BlockFi requires you to maintain a 50% loan to value (LTV) ratio to borrow US Dollars. If you are borrowing $25,000 today, you need to put up 1.36 BTC as collateral on a 12-month term.
If 1 BTC is worth $30,000, for example, then you would need to put up 2 BTC as collateral to borrow USD 30,000 from BlockFi.
With BlockFi, you receive your loan the same business day that BlockFi receives your collateral. As long as the collateral is in BlockFi’s hands, you can immediately access your loan.
You can pay off your BlockFi loan how you like. You pay off a portion of the balance – or the entirety of your balance – as early as you want. There are no prepayment penalties or fees.
It would be best to track your collateral to ensure it never falls below the 50% LTV ratio. BTC prices fluctuate wildly. If BTC suddenly drops, you may need to deposit more BTC as collateral to secure your loan.
BlockFi Now supports trading. You can buy and sell cryptocurrencies and stablecoins within your BlockFi account at competitive prices. As soon as you make the trade, the crypto is in your account – which means you can start earning interest.
Why trade with BlockFi instead of your usual crypto exchange? BlockFi emphasizes instant transactions, better pricing than competitors, and immediate interest accrual.
You can buy, sell, and exchange a small number of cryptocurrencies with BlockFi, including BTC, ETH, LTC, PAXG, or stablecoins like USDC, USDT, GUSD, and PAX.
To trade with BlockFi, sign up for a BlockFi account, fund your account, and hit the trade button on your dashboard to swap cryptocurrencies. You can also trade cryptocurrencies via iOS or Android using the BlockFi mobile app.
BlockFi aims to bridge the gap between the crypto world and the institutional world. With BlockFi, institutions can enjoy secure crypto trading while borrowing or lending cryptocurrency, earning returns on their holdings, and enjoying other benefits.
BlockFi appeals to institutions with its lending inventory, institutional backing, and enterprise-grade regulatory compliance. All of these features allow BlockFi to offer traditional financial services to the entire cryptocurrency industry.
With BlockFi, institutions can access similar products and services to what they access in the traditional financial space, including executing, margining, shorting, and reporting in the ways institutions expect.
Some of the institutions that work with BlockFi include market makers, investment funds, and crypto businesses. Some institutions use BlockFi for loans. Others use it to store crypto while earning powerful returns securely.
Some of the institutions backing BlockFi include Valar, Morgan Creek Capital Management, Susquehanna, HashKey Digital Asset Group, Akuna Capital, and CMT Digital.
BlockFi Bitcoin Rewards Card
BlockFi has announced the world’s first bitcoin rewards card. It’s currently listed as “coming soon” on the official BlockFi website.
The card will connect to your BlockFi account. You can spend money from your BlockFi account wherever credit cards are accepted. You’ll also earn rewards on those purchases.
BlockFi does not claim you’ll earn “up to” 1.5%. Instead, the company claims you will earn 1.5% back on every purchase. The website does mention an annual fee of $200, but they help offset that with a $250 bonus in bitcoin if you spend $3,000 within the first three months.
You can sign up for the BlockFi Bitcoin Rewards Credit Card by signing up for a BlockFi Interest Account, completing your user profile, making your deposit, and signing up for the waitlist.
BlockFi Mobile App
BlockFi has excellent mobile apps for iOS and Android. The mobile apps let you manage your BlockFi account on the go. You can view your balance, trade, borrow money, and earn interest, among other features – all without accessing the BlockFi desktop platform.
Some of the features within the BlockFi mobile app include:
Sign Up and Start Earning: You can sign up for BlockFi within the mobile app. If you don’t have a BlockFi account but are interested in signing up, you can do so through your Android or iOS device.
Earn Up to 8.6% APY: Mobile users have the same account as desktop users. That means mobile users can earn up to 8.6% APY on their holdings. BlockFi currently pays 8.6% APY on stablecoins, with bitcoin holdings earning an APY of 6%.
Borrow Money: If you have crypto in your account, you can use that crypto as collateral for a loan. You can use your crypto as collateral and withdraw USD, accessing your crypto value without actually selling your crypto.
Manage Everything: Overall, the BlockFi mobile app lets you manage everything about your account, including all of the features, products, and services you would usually access from your desktop platform.
BlockFi Bitcoin Trust
In January 2021, BlockFi was spotted registering something called the BlockFi Bitcoin Trust with the SEC.
That’s a big deal: it’s a sign BlockFi is preparing to launch a bitcoin exchange-traded fund (ETF).
The community has long anticipated a bitcoin ETF. We’ve been talking about it since 2017 when bitcoin first went mainstream.
Now, BlockFi may launch the world’s first bitcoin ETF in 2021- assuming the SEC approves BlockFi’s application for the BlockFi Bitcoin Trust.
Like other proposed bitcoin ETFs, the BlockFi Bitcoin Trust would hold bitcoins equal to its holdings. You could buy shares of the ETF just like you would purchase any ETF, and the value of the fund would lie in its underlying BTC assets. BlockFi would change a small management fee, and anyone who holds the ETF would make or lose money as bitcoin rises or falls.
The BlockFi Bitcoin Trust could be a big deal if it launches in the near future.
BlockFi Features & Benefits
BlockFi emphasizes the following features and benefits:
Easily Manage Your Account: After depositing crypto or stablecoins into BlockFi, you can easily manage your account. BlockFi gives you full transparency and control over your account and the assets within your account.
Mobile App: Manage your crypto holdings from any smartphone or tablet. BlockFi has a good mobile app that gives you full access to your account from any smart device.
Payment Flexibility: BlockFi aims to empower clients by letting them choose the cryptocurrency in which you receive interest payments. You can receive interest in bitcoin or a stablecoin, for example.
Maximum Security: BlockFi, understandably, emphasizes maximum security. The platform supports two-factor authentication and other security measures to protect your account while you safely earn interest. Your money is held with Gemini’s custodial system when you store it with BlockFi.
No Hidden Fees or Minimum Balances: BlockFi doesn’t come with a ‘catch.’ All terms and conditions are outlined straightforwardly. The platform does not charge any hidden fees, nor does it require you to maintain a minimum balance.
Move Money: You can fund your BlockFi account within the mobile app using your crypto wallet or bank account.
BlockFi makes a big deal out of its “no hidden fees” policy. That’s true: the company has no hidden fees. It discloses all fees upfront.
BlockFi does not appear to charge fees for trading cryptocurrency or stablecoins within your account. Once your money is in your account, you can trade it between coins without paying any types of trading fees.
However, BlockFi charges fees for most withdrawals. Here’s how the company’s fees break down:
- BTC: 0.0025 BTC per withdrawal, 100 BTC withdrawal limit per 7-day period.
- ETH: 0.0015 ETH per withdrawal, 5,000 ETH withdrawal limit per 7-day period.
- LTC: 0.0025 LTC per withdrawal, 10,000 LTC withdrawal limit per 7-day period.
- Stablecoins: $0.25 USD per withdrawal, $1,000,000 withdrawal limit per 7-day period.
- PAXG: 0.0025 PAXG per withdrawal, 500 PAXG withdrawal limit per 7-day period.
BlockFi gives you one free crypto withdrawal per calendar month, as well as one free stablecoin withdrawal per calendar month. For each subsequent withdrawal per month, you’ll pay the withdrawal fees listed above.
BlockFi Minimum Account Balance
BlockFi no longer has a minimum account balance required to earn interest. You can earn interest on your BlockFi account regardless of whether you have 1 ETH or 10,000 ETH in your account.
However, BlockFi does have withdrawal minimums of 0.003 BTC and 0.056 ETH. Withdrawals for balances smaller than these amounts could take up to 30 days to process.
How to Sign Up for a BlockFi Account
It’s easier than ever to sign up for a BlockFi account. You can open a BlockFi Interest Account (BIA) if you are over 18. Citizens of most countries can sign up for BlockFi without restriction. BlockFi has previously blocked users from New York, Connecticut, Washington, and the European Union. However, the company now seems to allow users from most parts of the world (except for countries sanctioned by the United States).
Step 1) Visit https://app.blockfi.com/signup or download the BlockFi mobile app for iOS or Android.
Step 2) Enter your personal information, including your name, email address, and password. If someone referred you to BlockFi, then enter the referral code. Accept the terms and conditions.
Step 3) Complete the KYC/AML process, verifying your information, and providing proof of identity.
Step 4) Click on the Deposit tab, then deposit funds into your account via cryptocurrency, bank transfer, or stablecoin transfer.
Step 5) You start earning interest as soon as money is in your account. Once the money is in your account, you can also use it as collateral to borrow money.
That’s it! BlockFi is designed to be straightforward for anyone to use – even if you’re relatively new to crypto. If all of this information seems like a good opportunity, consumers don’t have to spend much time signing up. As long as they are over 18 years old, they can provide their legal name with their email and password for the new account to register.
Registration is available online for all of the different products and services, so users will need to make sure they select the proper product. Opening a BlockFi account is quick and simple and users can start earning interest immediately after.
BlockFi is backed by some of the industry’s leading names. BlockFi has received financing and support from Winklevoss Capital, Susquehanna, Morgan Creek Capital Management, Coinbase Ventures, Galaxy Digital, and Valar, among other blue-chip venture capital firms.
According to TheBlock’s report, BlockFi has over $8 billion in total client balances and more than 125,000 funded accounts as of the end of 2020.
BlockFi increased its total client balances by 30x between 2019 and 2020 while also increasing the number of funded accounts by 12.5x, rising from 10,000 funded accounts in 2019 to 125,000 funded accounts in 2020.
BlockFi reportedly generated nearly $100 million worth of revenue in 2020.
BlockFi uses Gemini as its primary custodian. When you deposit crypto or stablecoins into your BlockFi account, your money is stored by Gemini, one of the most reputable names in the crypto space today.
For all of these reasons, many people see BlockFi as the future of finance. In the crypto space, the company remains one of the best options for seeking, borrowing, and maximizing their crypto value.
Who’s Behind BlockFi?
CEO and Founder Zac Prince lead BlockFi. Before launching BlockFi, Prince grew two startups to successful acquisitions, including Admeld (acquired by Google) and Sociomantic (acquired by DunnHumby). Prince also has financial and banking experience, leading business development teams at broker-dealer Orchard Platform and online consumer lender Zibby.
Other notable members of the BlockFi team include Flori Marquez (Co-Founder and SVP of Operations), Rene van Kesteren (Chief Risk Officer), Mahesh Paolini-Subramanya (Chief Technology Officer), Tony Lauro (Chief Financial Officer), David Spack (Chief Compliance Officer), and Adam Healy (Chief Security Officer).
BlockFi is headquartered in Jersey City, New Jersey. The company was founded in August 2017. Today, BlockFi also maintains offices in New York, Buenos Aires, London, Warsaw, Krakow, and Singapore.
You can contact BlockFi via the following:
- Phone: (646) 779-9688
- Support and Contact Info: blockfi.com/contact
BlockFi Crypto FAQ
Now that the cryptoasset market is peaking at all time highs in 2021, the rise in popularity and demand of the BlockFi crypto services has never been greater. The following questions are the most sought out inquiries regarding BlockFi and are meant to help inform, educate and even empower users to feel comfortable and confident using all of their services reviewed above. Here are the most pressing and pertinent questions pertaining to BlockFi in 2021:
What is BlockFi?
BlockFi is a financial services provider that brings together the trading and interest-bearing accounts of the traditional financial world to the cryptocurrency sector.
Does BlockFi offer its own cryptocurrency?
Not at this time, but they offer their own products and services to the public. Users can sign up for a trading account, an account that accrues interest on cryptocurrency, or an account that allows loans. At some point during 2021, clients will also have the opportunity to register for a Bitcoin credit card.
Why choose BlockFi?
BlockFi’s attention to customers is already an appealing reason to get involved, but they seem to have a financial product for anyone in the industry. Users don’t have to take much time to sign up, and they have multiple products available to make the most of their cryptocurrency experience. Plus, the company is transparent about its compliance with the current regulations in the market, ensuring that users know that they can trust the platform they trade on.
How can consumers and businesses open their accounts with BlockFi?
Signing up for an account as a business or a consumer is approximately the same process. Users sign up online for the product they want to use, funding the account immediately after. Accounts can be funded with stable coins, crypto assets, or simply the US dollar. Depending on the account, these assets start earning interest from the moment they are deposited.
New customers can register at https://blockfi.com
How does BlockFi stand out amongst the competition?
Though many of the features offered by BlockFi may sound familiar, there are several ways this company stands out. They provide a sense of security with the many investors that back them up, and they fully comply with all regulations set forth. The company is one of the few platforms that allows users to earn interest on their cryptocurrency holdings, even though it is regulated by the laws of the United States. It has the backing of other institutional investors, and it doesn’t provide a utility token – users simply choose the asset that they want to store.
BlockFi has already accrued $100 million for equity funding due to a Series C funding round. The village over $2 billion worth of assets, and they have support from other familiar companies in traditional finance. Some of those supporters include Avon Ventures, Winklevoss Capital, CMT Digital, Morgan Creek Capital, and Kenetic Capital.
The staff of BlockFi also helps some stand out as well. Though the leadership team named above may seem small, BlockFi employs over 300 people globally. To establish themselves, BlockFi has never had an initial coin offering, and there’s no requirement to keep the interest rates that they offer. So far, none of the clients that have invested with this company have seen losses.
Who is eligible to use BlockFi’s services?
Apart from the requirement to be at least 18 years old to engage in any type of trading, BlockFi has made it possible to provide their financial products and services around the world. Customers throughout the United States are eligible, though users will need to check the online listing of countries to ensure that theirs participates.
All of these newly enrolled clients will have access to fairly priced loans, accounts that earn interest, in trading that incurs no fees.
Are business/corporate accounts available?
Yes. However, in an effort to maintain compliance, there is much more documentation necessary to validate these accounts than for a personal account. Once the user chooses to open a business account, they will be contacted by the compliance team. The team member will guide the user through the rest of the registration process.
If the user already has a BlockFi account registered for their personal use, the same email address cannot be used for the business account. Users that register for the business account will also have to enter the individual information they would with another account, adding further documentation for the business.
Due to the popularity of BlockFi’s accounts, there are many applications currently in process. It may take up to 10 business days to receive a response from the team on this submission.
For any other questions, the customer service team can be reached with a phone call at 646-593-7308.
One of the opportunities available to consumers is that of becoming an affiliate with the BlockFi Affiliate Partner Program. Users that participate will have a passive income that is only made available by bringing financial tools to their investors that want to thrive in cryptocurrency.
As a partner, users, we’ll go through extensive training to help them make the most of their affiliation. They will have access to various dashboards that show how much they’ve earned, And they will have access to certain marketing materials to introduce the tools to their clientele. With each deposit, affiliates earn 0.5%, though they can receive as much as $1,000 in a single referral. All of the payments go directly into their bank account, though the company also offers direct deposits via PayPal.
Becoming an affiliate isn’t the only way that consumers can make more money with BlockFi. By referring a friend, users can get an additional $10 when the friend adds at least $100 to their BlockFi Interest Account. The friend who was referred will also receive $10, but users that refer at least five people will start earning $20 in Bitcoin for each referral after that.
Final Word: Is BlockFi Right For You?
BlockFi is a crypto asset management platform that offers several bank-like services. You deposit crypto into BlockFi, then use that crypto in more ways than you thought possible. After depositing funds into BlockFi, you can use that money as collateral for a loan, trade that money for different cryptocurrencies and stablecoins, or earn 6% to 8.6% returns per year.
It’s hard to get a complete understanding of cryptocurrency programs without doing extensive research. The reviews we read on the internet have been overwhelmingly positive about BlockFi. The project is providing cryptocurrency users with a valuable new service. With interest rates higher than most fiat savings accounts, BlockFi very well could revolutionize the way that cryptocurrency users earn money from their coins. We should note that crypto comes with inherent risks. Even considering the interest rates offered by BlockFi, it is always possible that your portfolio could lose its value over time.
Even staking cryptocurrency often cannot provide the kinds of gains offered by BlockFi. At the very least, this kind of program can help you to compound the value of your portfolio over time. The user-friendly design and signup process for BlockFi is also a massive benefit; new users to the world of cryptocurrency should have no trouble navigating the process.
In closing, BlockFi creates an opportunity that other companies simply do not – the chance to earn interest on cryptocurrency while it is still in their digital wallet. With different products for loans, trading, and more, consumers can bring cryptocurrency and fiat currency together. While there is not yet a chance to sell off the cryptocurrency for cash, users are assured that this benefit will soon be offered. Plus, there’s a credit card in the works that is currently the only opportunity of its kind, and BlockFi is headlining the opportunity.