Please ensure Javascript is enabled for purposes of website accessibility

Cryptocurrency Exchange to Offer High-Yield Savings Product

By Bram Berkowitz - Updated Feb 2, 2021 at 1:16PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Gemini, founded by the Winklevoss brothers, will offer annual percentage yields on cryptocurrencies that get as high as 7.4%.

The cryptocurrency exchange Gemini, founded by Tyler and Cameron Winklevoss, plans to launch a savings product that will pay out interest on crypto holdings.

The product will be called Gemini Earn, and there will be no minimum balance required to get started, and no fees to add or remove holdings from an account. It will only be offered to U.S. customers, and will be available in all 50 states.

The annual percentage yield (APY) will vary by the type of cryptocurrency in the account. For instance, the APY on a cryptocurrency called Filecoin will be 7.4%, but only 3.05% on bitcoin. Still, compared to the average national savings-account rate of 0.05%, it's a huge step up.

Gemini told CNBC that it's able to offer such attractive rates by lending out crypto to institutional borrowers, which pay interest on the loans.

Generic bitcoin picture.

Image source: Getty Images.

"There is a reason why Wall Street and traditional banking has been around as long as it has," Gemini's chief operating officer, Noah Perlman, told CNBC. "It provides lots of safeguards, and we think that we can get the best of both worlds and offer that to our customers."

Gemini is not the only exchange offering a high-yielding savings product. The crypto lender BlockFi also offers an APY as high as 8.6%, but BlockFi's interest-paying account is currently not available in New York due to state regulations.

Gemini has been launching other banking products. Recently, it acquired the company Blockrize and launched a credit card that offers 3% rewards in the form of bitcoin and other cryptocurrencies.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Bitcoin Stock Quote
$30,418.61 (3.73%) $1,094.28

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/19/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.