Version 4 - Cryptocurrency Interest Accounts


Author: Brendon Wong

Date Updated: 2021-11-18

Date Added: 2021-11-18

Research: Intermediate Investigation - Our team researched the mechanics and risks behind crypto lending and created multiple crypto interest accounts

Summary: Crypto interest accounts pay 8%–12% a year compared to <1% with savings accounts; we estimate they are riskier than savings accounts but safer than traditional investments

Recommendation: Use crypto interest accounts, like from BlockFi, for savings/investments that you are ok exposing to a higher risk of loss compared to savings accounts

Overall Impact Score: 5/10 - Moderate (~$150,000) effect on lifetime wealth
Audience: 95% - Most US adults
Benefits: Earn 8%–12% interest per year on US dollars Costs: No significant time or monetary costs compared to common alternatives Risks: We estimate an annual risk of partial/full loss of 0.5%–6%
Certainty: 95% - Interest payouts have been verified and risk levels are based on several years of historical results
Difficulty: Moderate - Hesitation around new technologies and setup logistics



Individual Recommendation If you have a decent ($1,000+) amount of savings outside of retirement accounts, a crypto interest account may make sense in the context of a diversified investment strategy (do not put everything in crypto interest accounts, and only invest money you can afford to lose). We recommend choosing large providers like BlockFi, Nexo, and Celsius which have many customers and a proven track record. Well-known providers like Coinbase and Gemini also work, but pay lower interest rates due to their brand power. Optionally, if you have enough invested for this to be worth it, spread your funds across multiple providers to reduce risk.


Organizational Recommendation Organizations with extra funds that are not earmarked for specific expenses or otherwise critically necessary can earn extra interest by investing their funds, including in crypto interest accounts. Even storing 10% of cash in a crypto interest account paying 10% interest is equivalent to earning ~1% interest on the entire cash balance, which is much better than most business savings accounts. Certain providers like BlockFi offer crypto interest accounts for organizations. We are familiar with several forward-thinking organizations that store funds in crypto interest accounts.


Societal Recommendation In general, cryptocurrency and decentralized finance are promising areas of societal systems change that are worthy of support. Regarding crypto interest accounts, many competing options pay low interest due to low competition, high administrative costs, and borrower defaults. We welcome options like crypto interest accounts that are competitive, have low administrative costs, and low default rates so that people can earn higher interest rates and thus have greater financial security and higher standards of living.

Learn More


You can get similar yearly returns to crypto interest accounts by putting your money in traditional investments. The upside of this approach is that it is very common, and the downside is that your account will fluctuate in value on a daily basis, whereas a crypto interest account does not fluctuate in value (unless the service is having a crisis).

Recommended Resources

How stablecoins and crypto lending works
Risk of cryptocurrency lending