BlockFi is designed to help you trade cryptocurrency and manage your money, all on the same platform. You can use BlockFi to open an interest account, take out crypto-backed loans and use traditional cryptocurrency trading services. This platform has been around since 2017, and while it’s independently owned, several financial giants like SoFi and Fidelity back it. If you’re looking into trading cryptocurrencies, a financial advisor can help you create a financial plan for your investing needs. Here’s what you need to know about BlockFi.
Services and Features: What Does BlockFi Offer?
BlockFi offers an interest account, crypto-backed loans and a trading platform. Users can choose to focus on any one part of the BlockFi platform, or they can use a combination of all three. Many users take out crypto-backed loans with the intention of investing them and achieving higher returns.
BlockFi Interest Account
With a BlockFi interest account, you’ll have access to high returns without having to trade or invest yourself. When you deposit your cryptocurrency in a BlockFi interest account, you’ll get up to a 3.5% APY on Bitcoin and Ethereum, and up to 2% on Dogecoin and Litecoin.
This interest account is free to open and use, and there is no minimum. All you need to do is set up an account and fund it with the cryptocurrency of your choice. BlockFi also has a calculator where you can see how much interest you’ll be projected to earn over a certain timeframe.
BlockFi Trading Account
BlockFi’s cryptocurrency trading account is one of the most robust on the market. It’s easy to set up and use, and you can even trade cryptocurrency that you hold in your interest account.
To make a trade, you just select what you’d like to buy and how you’d like to pay for it. You can use other cryptocurrencies to do this, or you can fund your account with fiat currency. There are no fees, so the price you see when executing a trade is the price it’ll cost you.
BlockFi Crypto-Backed Loans
The third arm of the BlockFi platform is its crypto-backed loans. With these loans, you can borrow up to 50% of the value of the cryptocurrency you hold instead of just swapping it out for cash. Rates are as low as 4.5%, but your specific rate and collateral size requirement will depend upon how big of a loan you want and which cryptocurrency you’d like to be loaned.
Pricing: How Much Does BlockFi Cost?
Another area in which BlockFi really stands out is its fee structure. The platform is virtually free to use, with no trading fees, commissions or account minimums. The only place you’ll encounter charges is when it comes to crypto-backed loans. These loans incur interest, but they’re free to take out and pay back.
There are, however, a few exceptions to BlockFi’s fee-free model. If you want earnings on your interest account to be paid in a different cryptocurrency than the one in which the interest has been earned, BlockFi may take 1.5% of the total amount of interest you earn. This exact amount may fluctuate based upon the cryptocurrency and market conditions.
You’ll also be charged for multiple withdrawals in the same month. Rates differ depending on the type of cryptocurrency that you’re withdrawing. For example, with Bitcoin, the price is 0.00025 BTC per extra withdrawal. Though it is worth noting that since October 2022, “holders of the BlockFi Rewards Visa Signature Card with a monthly statement spend of $100 or more will be eligible for 1 free BTC withdrawal rebate per month.”
Effectiveness: How Well Does BlockFi Work?
Simply put, BlockFi works well for its users across its three focal points. Whether you want a place to securely deposit your cryptocurrency, trade crypto or take out a crypto-backed loan, BlockFi can help you out. It’s a reputable company backed by major financial institutions, so you can likely be confident in it.
Among other cryptocurrency trading platforms, BlockFi stands out for its versatility and accessibility, even for those who don’t have much background in cryptocurrency investing. The platform’s functionality and highly rated mobile apps also make it easy to manage your account on the go. However, you should note that other platforms like Coinbase offer tools, data and other informational resources that aren’t available on BlockFi.
Bottom Line
Whether you’re just getting started in the world of cryptocurrency or have been investing in Bitcoin and other cryptos for years, BlockFi is a great option. With virtually free trades and access to interest accounts and loans, there are multiple ways in which users can use the platform to their benefit.
While withdrawals at BlockFi are limited to a certain extent, you can still take out assets once a month, fee-free. With strong customer reviews, BlockFi is a top option for anyone looking for a cryptocurrency trading platform.
Investing Tips
- Cryptocurrency investing can be tough, especially when combined with your other, more traditional investments. A financial advisor can offer you hands-on investing advice for your portfolio. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Those who are taking personal charge of investing should take every step possible to stay on top of things. SmartAsset has you covered with a range of free online investment resources. For example, check out our free asset allocation calculator today.
Photo credit: BlockFi, ©iStock.com/ipopba