Everybody in 2021 is in agreement about two things: Cryptocurrency prices are extremely volatile, and a hot dog qualifies as a sandwich.
Bitcoin’s recent performance is a good example of the kind of volatility for which crypto has come to be known: Its price peaked near $65,000 in April before falling by more than 30% to around $30,000 in just a few hours on May 19.
Seasoned crypto traders are aware of the volatility as they are playing the long game with the altcoins they trust. Panic selling and FOMO (fear of missing out) buying don’t always help in the long run.
To boost investment yield, long-term crypto traders are using one more way to make money off their investment — crypto interest accounts.
How a Cryptocurrency Interest-Earning Account Works
In theory, a crypto interest-earning account works just like a regular savings account.
You deposit your Bitcoin or altcoin with no lockup period or deposit limits, your asset earns compound interest, and you receive payouts and can withdraw your funds at any time.
The interest is driven by market effects and is paid out in the same cryptocurrency that you have placed. There is also a withdrawal fee that is regularly adjusted according to blockchain conditions.
It’s worth noting that when compared to traditional market rates, the interest rates within crypto markets are incomparable. Think of it as a trade-off between risk and reward.
The top rate you can currently earn from a nationally available savings account is 0.70% annual percentage yield (APY). In comparison, leading crypto interest-earning account platforms give you annual interest rates of up to 10.5% on your altcoins. All the deposits automatically earn the best rate and the interest compounds at the end of each month.
Easy-to-Follow Steps to Get Started
Most crypto interest account platforms typically involve the following steps to creating an account:
- Provide identification details: First, you need to identify yourself by signing up using a valid email address and password, setting up 2-factor authentication and uploading your ID documents.
- Successful account verification: Once your account is fully verified, you will receive an email confirmation that lets you use your interest account.
- Select the asset: Crypto interest accounts may provide a select number of cryptocurrencies you can deposit. You can choose the altcoin you would like to deposit.
- Copy the deposit address, and initiate the transfer: You can copy the deposit address, and you can head to your Ethereum wallet or Bitcoin wallet to initiate the transfer.
- Wait until the transfer is settled: The deposits require a certain number of block confirmations before your account is credited. After the asset is deposited, interest will accrue automatically.
Emerging Crypto Lending Platform
There are many crypto lending platforms, but one company that has come under the crypto radar and is making serious strides is Hodlnaut.
When compared to the likes of BlockFi, Celsius Network or Gemini, Hodlnaut offers some of the highest payouts to earn on your crypto assets — up to 10.5% APY on stablecoins (like USDC) and 6.2% APY on Bitcoins. Right now, you can get a $20 bonus when you deposit at least $1,000. Sign up now.
The platform is user-friendly and offers easy yields to anyone wanting to put their crypto to good use. There is no minimum deposit amount, making it ideal for new crypto users who want to familiarize themselves with the service.
Hodlnaut allows you to earn interest on 5 different assets including Bitcoin, Dai, Ethereum, USD Coin and Tether. The annualized yield is 6.2% APY – 10.5% APY, and paid out weekly on Mondays.
The Singapore-based company has more than $243 million in assets under management and is growing at an average of 20% month-on-month.