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BlockFi offers a cryptocurrency exchange, interest-bearing accounts, and low-interest-rate loans worldwide. There are no transaction fees on trades, and you won't have to worry about hidden fees or minimum balances. Read our BlockFi review for an overview of the company's trading, saving, and lending options and costs.
Ratings Methodology
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BlockFi
Rating image, 4.50 out of 5 stars.
4.50 stars
We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor.
Bottom Line
One of the few cryptocurrency exchanges that includes no commission fee, no monthly fees, and no minimum deposit.
Fees:
$0 trading fees
Account Minimum:
$0
This cryptocurrency platform is a good fit for: Beginner and intermediate cryptocurrency investors who want to bridge the gap between traditional finance and crypto.
Pros
- U.S.-based and regulated
- Instant trades
- No commission fee
- No monthly fees or minimum deposits
- Available worldwide, except sanctioned or watch-listed countries
Cons
- No joint or custodial accounts
- Limited free withdrawals from interest accounts
- APY and loan rate volatility
- Savings aren't protected against bank failure
Top perks
Earn interest on your holdings
With a BlockFi Interest Account, you can earn between 3% and 8.6% compounding interest on your cryptocurrency holdings. The account has no hidden fees and no minimum balance requirement.
The interest rate varies by currency type and fluctuates with market values. Interest accrues daily and is added to your account monthly -- so you'll earn interest on your interest each month. The Interest Payment Flex option lets you choose the currency your interest is paid in.
U.S. investors will get a 1099 from BlockFi at the end of each year stating how much interest they received. International customers are responsible for managing their own tax liability.
Borrow against your portfolio
Avoid selling your crypto when you need cash. BlockFi lets you borrow funds in USD against your crypto assets with interest rates as low as 4.5%.
Borrowing instead of selling means you don't have to report capital gains, which could save you money in taxes. Plus, the interest could be tax deductible, reducing your tax bill even further.
Note: One risk of borrowing this way is that you could lose your collateral -- your crypto assets -- if crypto prices drop. It would mean you no longer have enough value in your interest account to support your loan balance.
Rewards credit card
BlockFi is the first company to launch a Bitcoin rewards credit card, a Visa credit card that earns 1.5% back in bitcoin on every purchase. Your Bitcoin rewards will be added to your BlockFi Interest Account, so it earns interest right away.
It's not yet available, but you can join the waitlist to apply when cards start shipping in spring 2021. Applications are subject to credit approval. Early applicants will have extra opportunities to earn even more bitcoin with the card.
U.S.-based and regulated firm
BlockFi is one of few crypto exchanges based in the United States. Its custodian, Gemini, is regulated by the New York State Department of Financial Services.
BlockFi hasn't relied on an ICO (investor offering) or utility tokens for funding. Instead, it pays a stable interest rate by earning through its lending products.
Automatic trading
When you have funds in your BlockFi Interest Account, you can set up recurring trades. These can automatically buy cryptocurrencies daily, weekly, or monthly. That way, your account can grow in value and earn interest even if you don't spend much time actively trading.
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What could be improved
Limited free withdrawals
You can make one free crypto withdrawal and one free stablecoin withdrawal per month. Beyond that, you'll pay a fee for each withdrawal, which varies by currency.
No custodial accounts
Many investors are looking to cryptocurrencies to protect long-term investments against inflation. Despite the volatility of these currencies, they could be an attractive option to save for college or other savings plans for kids.
Custodial accounts -- held in an adult's name that transfers to a child when they turn 18 -- aren't common in crypto exchanges. BlockFi doesn't offer one, but it says it plans to in the future.
There's technically no legal age to buy or own cryptocurrencies anywhere in the world. But exchanges in most countries, including BlockFi, require users to be 18 years old or older. This makes it difficult for kids to take advantage of the potential long-term savings benefits of cryptocurrency investments.
Alternatives to consider
If you want to manage crypto trading and U.S. stock trading in one platform: Robinhood is a popular investment app that launched in 2015. It lets you trade in 17 cryptocurrencies with zero commission fees.
If you just want to dabble in Bitcoin: Check out the Cash App by Square. Best known for person-to-person payments, it also includes a stock trading platform and you can buy, sell, and trade Bitcoin.
| Offer |
Get a free stock with a new account |
|
|---|---|---|
| Rating |
Rating image, 4.50 out of 5 stars.
|
Rating image, 4.00 out of 5 stars.
|
| Best For |
Modern investing experience and low costs
|
Simplified investing
|
| Trading Commissions |
$0 for stocks, ETFs, options, and cryptocurrencies
|
$0 for stocks, fees vary for cryptocurrencies
|
| Account Minimum |
$0
|
$0
|
| Next Steps |
How BlockFi works
BlockFi is a cryptocurrency exchange and wallet that serves individuals and businesses worldwide. It offers an interest-earning account, portfolio-backed loans, and fee-free trading.
As with many of the best cryptocurrency exchanges, you can fund your account with USD, crypto, or stablecoins.
BlockFi Interest Account
This interest-bearing account holds coins you've deposited or purchased on the exchange. It works much like a traditional savings or investment account. One big difference is that money you put in a bank account would be protected up to $250,000 against bank failure through FDIC insurance. Similarly, any cash in a brokerage account would be protected by SPIC insurance. But if you put your savings into a BlockFi Interest Account, you don't have these protections.
You're limited to one crypto withdrawal and one stablecoin withdrawal per month. After that, you'll pay a fee for each withdrawal. You can make automatic transfers to any bank account connected to Plaid, a company that allows apps to securely transfer data to and from your bank.
You can also set up a business or corporate account. It functions the same way as an individual BlockFi Interest Account but is in the entity's name. It requires additional documentation and a longer verification process. Once you apply, a member of BlockFi's compliance team will contact you to help with the rest of the sign-up process.
It pays these interest rates:
- Bitcoin (up to 2.5 BTC): 6%
- Bitcoin (more than 2.5 BTC): 3%
- Ethereum: 5.25%
- LINK: 5.5%
- PAX Gold: 5%
- Litecoin: 6.5%
- Paxos Standard: 8.6%
- USDt: 9.3%
- USDC, GUSD, and BUSD: 8.6%
Interest begins to accrue the day after you deposit and compounds monthly.
BlockFi pays interest by lending assets to institutional and corporate borrowers with high collateral. It stores reserves -- so it can fund your withdrawals -- with New York trust company, Gemini, and other third parties.
The BlockFi Interest Account is available to customers in most countries and in all U.S. states except New York.
BlockFi Trading
Use funds from your BlockFi Interest Account to purchase cryptocurrency on BlockFi's exchange without fees. You'll have daily trading limits based on your account size and activity.
To make a trade, simply log into your BlockFi account, and enter the buy or sell amount and currencies, and authorize the trade. You can make a one-time trade, or automate the trade to recur daily, weekly, or monthly.
When you buy crypto on the exchange, it'll land in your Interest Account and start to earn interest right away.
Crypto-backed loans
Use a BlockFi loan like a personal loan to fund major purchases, refinance debt, or make a down payment on a home.
You have to use crypto assets to back the loan with a loan-to-value (LTV) ratio of at least 50% (meaning your collateral is worth at least half of what you owe). You can borrow in USD, GUSD, or USDC; and put up collateral in Bitcoin, Ethereum, or Litecoin.
You'll pay a 2% origination fee to receive your loan, and pay interest between 4.5% and 9.75%, depending on your LTV.
Fees overview
BlockFi doesn't charge transaction fees for trading on its exchange. You'll pay fees to withdraw funds from your account more than twice per month. Also, you'll pay origination fees and interest on crypto-backed loans you borrow through the company.
Withdrawal fees
BlockFi allows one free crypto withdrawal and one free stablecoin withdrawal per month. After that, you'll pay a fee per withdrawal based on currency.
| Service/Item | BlockFi Cost |
|---|---|
| 1st monthly crypto withdrawal | Free |
| 1st monthly stablecoin withdrawal | Free |
| Bitcoin | 0.00075 BTC |
| Ethereum | 0.02 ETH |
| LINK | 0.10 LINK |
| Litecoin | 0.0025 LTC |
| Stablecoins | $10.00 USD |
| PAX Gold | 0.015 PAXG |
Loan rates and fees
| Loan-to-Value | Interest Rate | Origination Fee |
|---|---|---|
| 50% | 9.75% | 2% |
| 35% | 7.9% | 2% |
| 20% | 4.5% | 2% |
Cryptocurrency selection
BlockFi supports six popular cryptocurrencies, including Bitcoin and Ethereum, and four stablecoins, including USDC and GUSD, the native currency of its custodian, Gemini.
- Bitcoin (BTC)
- LINK (LINK)
- Ethereum (ETH)
- Litecoin (LTC)
- Paxos Standard (PAX)
- PAX Gold (PAXG)
- USD Coin (USDC)
- Gemini dollar (GUSD)
- Tether (USDt)
- Binance USD (BUSD)
Is your cryptocurrency safe with BlockFi?
BlockFi is one of few U.S.-based crypto exchanges and it operates within U.S. federal and state regulations. However, as we discussed above, like all crypto assets, funds in a BlockFi account are not insured by the FDIC or SPIC.
BlockFi employs several security measures to protect your assets and ensure funds are available:
- It keeps reserves with third parties, including Gemini, BitGo, and Coinbase.
- It buys SEC-regulated equities and CFTC-regulated futures -- i.e. investments regulated by the U.S. government.
- It lends carefully, with loans backed by up to 50% collateral.
In addition to its state-regulated custodian, BlockFi is backed by reputable investors. These include Valar Ventures, Morgan Creek Capital Management, Coinbase Ventures, and more.
BlockFi lets you opt into something called allowlisting. This is a self-service security feature that allows you to ban withdrawals or restrict them to certain addresses. This security measure helps prevent theft from your BlockFi account.
BlockFi is right for you if:
- You're a beginner or intermediate cryptocurrency investor.
- You're open to increased regulation in exchange for higher security.
- You're looking for a personal or business account.
- You want to earn interest on your crypto holdings.
- You want easy access to portfolio-backed loans to maintain liquidity without incurring capital gains taxes.
About the Author
Dana Sitar (@danasitar) has been writing and editing since 2011, covering personal finance, careers, and digital media. She trains journalists, writers, and editors on writing for the web and has written about finance and careers for publications including The New York Times, HuffPost, and a column for Inc. Magazine.
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