Cryptocurrency exchange Bitfinex is now offering a way for holders of 3 different cryptocurrencies to earn up to 6.2% interest annually.
In line with a recent official announcement, Bitcoin [BTC] & Ethereum [ETH] holders are now eligible to earn up to 6.2% annual percentage yield [APY] vias its recent collaboration with Celsius Network, while Ripple [XRP] holders can earn up to 4.91% APY. The lending platform, which presently has over $1 Bln in coins from roughly 150k users, added that it might permit interest on the tokens to be accrued daily, with rewards paid on weekly basis.
“We expect this offering to appeal to users that have bought Bitcoin as a long-term store of worth, and who also want to earn on their assets while they hold,” added Bitfinex CTO Paolo Ardoino.
The exchange is offering BTC, ETH, as well as XRP holders better APY rates than the typical rates offered for fiat savings accounts, making Bitfinex competitive in some respects with banks. On the other hand, several traditional investors still view banks as less risky than crypto assets, their interest rates rarely exceed 1-2%. Moreover, cryptocurrencies frequently fluctuate more in price within a day, than the annual rate of interest at Bitfinex so there are swings & roundabouts.
Celsius CEO Alex Mashinsky has often revealed that the lending & borrowing platform’s goal is to “bring 100 Mln, new people, into the crypto ecosystem.” Presently, users can earn up to 15.89% APY on rewards for 12 stablecoins employing the platform.
Coinbase launched an identical system for cryptocurrency traders to realize 2% APY on their Dai [DAI] holdings and 0.15% for USD Coin [USDC] holders. The exchange added that rewards on both stablecoins offer a way to passively generate income on the digital assets “with yields on savings accounts & government bonds at record lows.”