Brave Advertising BlockFi -


Probably doesn't know what he's talking about.
I am a crypto pleb, and today i saw brave advertising blockfi on its native home page. do the bitcoin experts on KF recommend/disavow/not care/prefer another service?


+Disclaimer: Though a bit dated, this is the best, swiftest, most detailed analysis of BlockFi for newbies.

Pros and Cons: My Experience Earning Interest with BlockFi
Joe Pile
Joe Pile

Jul 19, 2019 · 10 min read

  • Zero-Fee TradingBlockFi now offers a feature allowing users to seamlessly trade between BTC, ETH, LTC, USDC and GUSD on the platform at zero cost. A great addition for those interested converting their GUSD interest into BTC to stack sats even more efficiently. (Read More)
  • Compounding Interest BlockFi offers monthly compounding interest unlike Celsius and remains one of the most attractive aspects of their service (What is Compound Interest?). That is, the interest you earn will also earn interest the following month. This means that if you earn interest in Month 1, your next interest payment will be calculated off of your new total balance (old balance + interest payment from Month 1). This is the best part of BlockFi’s Interest Accounts and a great way to build wealth exponentially over time.
  • No Early Withdrawal Penalty — They have announced users will no longer be subject to early withdrawal penalties which means you’ll be free to withdraw your funds at anytime of the month without taking a hit. This is definitely a step in the right direction and let’s hope there are more improvements to come! Read the announcement HERE.
  • One Free Withdrawal per Month — I’ve definitely complained about the withdrawal fees in the past, but having the ability to withdraw funds without their excessive fees is a welcomed feature — even if that’s only once per month. This will at least give those who have been looking to test out their product the opportunity to deposit a small amount of BTC to see how their product works. I hope they continue these improvements and soon offer more free withdrawals in the near future.
  • No Minimum Requirement to Earn Interest — The BlockFi Interest Accounts no longer require a minimum balance to be eligible to earn interest (Read the announcement HERE).
  • USDC & LTC Support — They’ve added USDC and LTC support in 2020, allowing users to earn interest on their favorite assets.
  • More Consistent Earnings — I’m slowly changing my mind about the consistency BlockFi’s interest rates. They continue to exercise their right (as indicated in their ToS) to change their rates. Though they do not change their rates weekly like Celsius, BlockFi in many ways shapes themselves after the traditional financial sector with their business hours and somewhat stiff structure. But due to the image they’ve built up in the eyes of the crypto community, these minor changes on a bimonthly basis has become a bit tiresome. Just when you think you can rest easy they change the rate AS WELL AS the tier limits. This means many depositors may have to move their coins around on a fairly regular basis if they deem it no longer worth their while or transferring it to another platform. They don’t have weekly fluctuating APY to keep track of, but they have made changes every couple months.
  • Earn In-Kind or Payment Flex— In-kind means you generally receive interest in the original asset invested, so BTC if lending in BTC and ETH if lending ETH. They now offer the ability to earn interest in the asset of choice (BTC, ETH or GUSD) with Payment Flex. This means if you want to invest GUSD and earn your monthly interest in BTC, that is now possible. A pretty nifty feature, but keep in mind they charge up to 1.5% for this service!
  • Monthly Payouts — You will receive your interest the 1st (ish)of every month along with a statement. Statements are sometimes delayed by a day, as are payouts.
  • Monthly Statements — They make record keeping painless with monthly statements similar to what you would receive from a bank. It tells you how much you hold, how much you’ve earned, and how much you’re projected to make the following month.
  • No Utility Tokens Required— Unlike the competition, BlockFi does not require utility tokens to take part in their service. Instead, all users are treated equally. This means you are not forced to trade/hold platform utility tokens which are often used by competing platforms to incentivize higher interest rates.
  • Gemini Custodian Services— Your assets are securely stored at a unique wallet address generated by Gemini, a New York trust company licensed by the New York State Department of Financial Services. Gemini is a fiduciary under §100 of the New York Banking Law and held to specific capital reserve requirements and banking compliance standards. Gemini also has digital asset insurance coverage and is SOC 2 Type 1 security compliant on its exchange and custodian platform.
  • Responsive SupportBlockFi support seems to respond to user inquiries more promptly compared to my experience with Celsius and other platforms.
  • High Fees — Beyond the single free withdrawal per month every user receives, something to keep in mind is that BlockFi’s withdrawal fees are quite high at 0.0025 BTC and 0.0015 ETH, respectively. This is supposedly set by the custodian, Gemini, and these fees are passed on to them. I hope to see unlimited fee-less withdrawals in the near future. Stablecoins charge 25 cents per withdrawal.
  • Interest Rates —You will need to keep in mind, BlockFi has the ability to adjust their rates freely at their own discretion (and they do). They had initially promised 6.2% APY lending rates on all their digital assets; however, shortly thereafter lowered the ETH interest rates to 3.3% APY due to a stagnant ETH lending market. And more recently capped the maximum BTC balance for the 6.2% rate to 10 BTC as of Dec 1st 2019 after dropping the cap to 5 BTC for a short period.
  • BTC Lower Tier Interest Rate—There is no longer a minimum balance required, so balances up to 5 BTC (lowered from the initial 25 BTC then brought back up from the 5 BTC limit and back down yet again) earn 5.1%. All balances over this limit will earn a lower rate of 3.2% interest. To clarify, if you had 5.5 BTC in your BIA account, the first 5BTC would earn interest at 5.1% and the remaining 0.5 will earn interest at 3.2%.
  • ETH Lower Tier Interest Rate— For ETH, BlockFi accounts with balances up to 500 ETH will earn 3.6% while balances above 500 ETH will earn 2.0% (down from 1000 ETH at 4.1% and balances above 1000 ETH at 0.5% APY).
  • Limited Asset Options — They only offer BIAs for BTC, ETH, LTC and GUSD/USDC.
  • Lower Value Withdrawals— Any withdrawals under 0.003 BTC and 0.056 ETH could take up to 30 days to process.
  • Withdrawal Time— Your withdrawal request have a 24 hour hold (for security purposes) so expect withdrawals to be processed the following day — but keep in mind they’re hours of operation are standard business days, meaning pushing through transactions on the weekend may not go as planned. BlockFi also reserves up to 7 days to process a client fund withdrawal, subject to additional review from their compliance team.
  • Must Pass KYC to Earn Interest — You can create an account, but in order to deposit funds and earn interest you must submit all required information.
  • Web Only — They only offer wallets via web-access. They do not have wallets in the form of iOS and Android Apps or desktop wallet.
  • Lack of Community/Outreach — They have been actively improving their exposure to the online community since I first wrote this article. Though, there’s only a small level of engagement, it seems to be catching mor steam. (REDACTED: Unlike Celsius, BlockFi does not have a strong presence on social media and lacks the overall sense of community Celsius has cultivated. There is no place on the web to interact with fellow BlockFi users or make inquiries about their service in an open format. Their subreddit doesn’t seem to have any active moderators or content posted on a regular basis (they seem to have placed more attention on this since posting this article and a BlockFi rep seems to be answering community queries). This does give off an impression of a ghost town which could easily dissuaded potential users from trying out their service. I would like to see improvement in this area, but I would assume this is an intentional decision by BlockFi’s marketing team.)
  • Security — As the age old adage goes, “Not Your Keys, Not Your Coins.” Always make sure to only invest what you’re comfortable with as nothing beats the assurance and security of controlling your own keys.
What about Rehypothecation?
Some critics in the past have mentioned the legalese in their ToS allowing “Rehypothecation” of user funds. BlockFi has responded to these concerns with this blog entry. However, for anyone that has read ToS and User Agreements for similar lending platforms, the language used in these contracts are strikingly similar and often include “Rehypothecate/Rehypothecation” — yes, this includes the crypto community’s golden child of lending Celsius Network’s ToS. And if you’re uncomfortable with one, you will more than likely be uncomfortable with all of them.

Again, this is not to say there are no risks, because there always are. Every one should perform their own risk management and decide what they are comfortable with.

In Conclusion
BlockFi undoubtedly has their fair share of caveats compared to their competition. I hope they will improve their policies in the near future (the withdrawal process used to be painstakingly time consuming and has been greatly simplified recently which is a positive sign).

For those curious to hear more about BlockFi, I highly suggest checking out this podcast withBlockFi CEO Zac Prince. I found it very informative hearing what the company is aiming to achieve and how they plan on making waves in the crypto space while keeping our funds safe.

At the end of the day, you’ll have to decide whether BlockFi is the right fit for you! There are plenty of lending platforms out there with their own pros and cons — do your own due diligence and make sure you stay informed!


EDIT: Archived here.
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IBS were rigged from the start
Up to 8.6% annual interest? Seems totally legit to me, and absolutely not like an exit scam, no no sir.