Blockfi is one of the pioneers in the field of cryptocurrency with its loan products. Currently, the company has officially announced its new product – Blockfi, which gives customers the opportunity to receive interest on their deposits. Recently launched cryptocurrency accounts support both Ethereum (ETH) and Bitcoin (BTC) and promise six percent per annum paid monthly in the underlying digital asset. Customers also have the opportunity withdraw funds at any time. According to the announcement, customer assets will be held by Gemini Trust, which is regulated by the New York State Department of Financial Services.
Blockfi's deposit program is an extremely attractive offer, considering that the current yield on traditional bank deposits in developed countries is up to two percent. This can attract new investors to the field and provide the current owners with an alternative financial product.
Considering that cryptocurrency holding in the long term was common among crypto enthusiasts over several market cycles, the interest account now allows holders to increase their assets over time. Blockfi will be able to distribute customer assets at its discretion and make them commercially viable. Revenues distributed to interest accounts are likely to come from cryptocurrency lending activities. Ultimately, the relationship between the client and Blockfi will be based on trust, as in traditional banking.
With its loan product and recently issued deposit accounts and further plans for issuing credit cards, Blockfi is essentially a cryptocurrency bank. This kind of organization will not only turn the heads of retail investors towards crypto, but also convince more institutional investors to enter the cryptocurrency industry, improving market liquidity and public awareness.