BlockFi is increasing its interest rates on BTC, ETH, and stablecoins.
The company claims the rise in rates is made possible by its effective risk management strategies, decreasing market competition and changing macroeconomic yield conditions.
The announcement comes three days after BlockFi secured a $250 million loan from FTX to “bolster” its balance sheet.
Share this article
BlockFi is raising the yield on its Bitcoin, Ethereum, and stablecoin lending products three days after FTX extended the company a $250 million revolving line of credit.
The Powers of “Effective Risk Management”
BlockFi will soon be raising the interest rates of their lending products.
According to their official Twitter account, the crypto lending company will be increasing its rates across all tiers for Bitcoin, Ethereum, and major stablecoins such as USDC, USDT, GUSD, PAX, and BUSD.
Yields on Bitcoin will be increased by 0.5% to 1.9%, Ethereum by 0.5% to 1.75%, and stablecoins by 0.5% to 3%. This brings rates for Bitcoin and Ethereum to a range between 2% and 3.5%, and stablecoins from 6% to 8.75%. The increase will be effective at the beginning of July.
The company will also be lowering their withdrawal fees by $1 for Bitcoin, $2 for Ethereum and $25 for stablecoins; on the other hand, it will entirely remove its “one free withdrawal per month” policy.
BlockFi said it was able to increase interest rates thanks to effective risk management, decreasing market competition, and changing macroeconomic yield environment. It pointed out, for example, that it had never had exposure to UST or stETH, and stated that “as crypto market volatility increased in May and June 2022, BlockFi was among the first to de-risk our credit and market risk exposure.”
The announcement notably did not mention the $250 million loan the company received from crypto exchange FTX just three days ago. The loan had been extended to “bolster” the firm’s balance sheet and platform strength.
The company had previously laid off 20% of its workforce and liquidated a loan made out to prominent crypto hedge fund Three Arrows Capital. A leaked financial statement also showed BlockFi had lost more than $285 million over the past two years. Though its authenticity is unconfirmed, the document has reinforced rumors about the firm’s financial struggles.
Disclosure: At the time of writing, the author of this piece owned ETH and several other cryptocurrencies.
Share this article
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.