As the popularity of cryptos continues to grow and more consumers trade in digital currencies, new brands have come on the scene. These include CeFi and DeFi platforms.
But how do you know which one's right for you? The answer to this question depends on various factors, including your experience level with cryptos, your current crypto-asset holdings (if any), the coins you'd like to use, the level of security you desire, and more.
With that in mind, let's compare two of the world's most popular crypto platforms, BlockFi vs Celsius Network. Here's what you need to know before beginning to buy, sell, or trade on either platform.
When it comes to the most popular cryptocurrency lending platforms on the market today, you'll find BlockFi consistently listed at the top. Besides providing lending and borrowing services, the company boasts native exchanges.
These exchanges permit investors to transfer between various crypto assets seamlessly. But the functionality of the platform doesn't stop there. With BlockFi exchange, you'll gain access to a reputable platform based in the United States.
The company offers flexible lending terms without locking up users in extended contracts. What's more, with BlockFi, customers enjoy the ability to receive interest payments in any digital currency of their choice. It doesn't get much handier than that!
That said, the platform also comes with a handful of downsides. For one, you'll face a flat fee on every withdrawal made after your initial transaction. You'll also find that crypto assets are limited, and withdrawal times can take a while.
Celsius Network Overview
Why do people turn to Celsius Network for their lending, buying, and crypto trading needs? Because this site permits users to borrow dollars at rates below one percent while earning ten percent interest on their crypto deposits.
Celsius Network also supports various features that customers love, including sharing revenue with holders of its proprietary token, CEL. As a Celsius Network user, you can send crypto to others without a wallet. Besides these features, the network offers instant loans.
And if you place your assets in a savings account as CEL, you can expect to see some of the highest interest rates available in the industry. The platform supports 25 different crypto assets, providing customers with plenty of options.
Which features of the platform do customers find less appealing? Some complain about the limits on withdrawals of more than $20,000.
What's more, you must use the platform's token, CEL, to gain access to better rates. Get all the details about Celsius Network and how it works.
Celsius Network vs BlockFi: User-Friendliness
Both Celsius Network and BlockFi focus on making lending and borrowing cryptos a cinch. They allow users to lend, borrow, and access other features conveniently on their mobile devices.
That said, Celsius Network does have a slight edge on BlockFi when it comes to overall ease of use. It makes the initial loan application process easy and can be completed within as little as one minute.
Even though Celsius Network proves a bit more beginner-compatible, there's one compelling reason to give BlockFi a try if you're new to the whole crypto world. BlockFi offers greater flexibility for new users.
You don't have to lock yourself into any specific timeframes when funding a wallet and staking crypto collateral. With BlockFi, you'll also have the ability to move in and out of loan positions more rapidly.
For this reason, BlockFi may represent the most sensible option for investors who don't want to lock their crypto up for months at a time. Find out more about this crypto wealth management platform.
Both platforms allow customers to access their sites via smartphone devices. But only BlockFi may be accessed using a desktop computer.
By allowing users to access these platforms through website browsers, these crypto lending platforms enable customers to lend and borrow cryptocurrency with any operating system.
How Does Signup Work on Each Platform
How does the signup process work for each crypto lending platform? The process proves much easier than you think.
You'll have to provide some simple information, including your name and email address, to create an account. But that's just the first step. Next, you'll also need to go through the steps for a full account verification process before gaining access to features like interest and loan accounts.
Even though both platforms are very similar, there are a few distinctions you need to know about. For starters, Celsius Network's streamlined application process permits users to gain access to loans in a matter of minutes instead of days.
For Celsius Network, account verification usually only requires a handful of minutes. The process can take up to 24 hours in some situations, though. But these prove rare.
Why does this sometimes happen? The process cannot be totally automated because of an issue with one of the documents. Or it could be some of the information provided by the user.
Celsius Network vs BlockFi: Unique Features
Are there other features you need to know about with each crypto platform? Absolutely!
Let's start by taking a closer look at BlockFi. The most attention-grabbing feature is its integrated exchange platform.
Customers can switch between different crypto assets and manage their overall crypto portfolio through this exchange. And they can do it without having to move funds to another crypto financial institution.
Where does Celsius Network fit into the mix? Unlike BlockFi, Celsius Network is not an exchange. So, you can't buy or exchange cryptocurrencies there.
Instead, the company's native token, CEL, remains its standout feature. Not only does it allow users to gain access to cheaper loans and more lucrative interest accounts, but holders of CEL receive a share of the profits earned by the Celsius Network.
These profit shares get awarded regularly, making Celsius Network a popular option for many crypto enthusiasts. What's more, you must use this native token to earn their higher interest rates. Depending on how you look at it, this represents either a pro or a con.
Cryptocurrencies Supported by Each Platform
What about the variety of crypto assets accessible to users on each platform? In this area, Celsius Network has an obvious advantage over BlockFi.
Remember that BlockFi is limited to Bitcoin, Ethereum, and Litecoin, as well as some stablecoins. What's more, users can earn interest on holdings of crypto assets like Dash, Bitcoin Cash, and Ripple. But with Celsius Network, you get access to 25 different crypto assets.
Celsius Network's native token, known as CEL, allows Celsius Network users to access additional features. These features include lower rates of interest for loans and higher rates of interest on their crypto holdings.
You'll pay interest rates on loans of 0.7 percent when payments are made via CEL. What's more, you'll enjoy 1.0 percent when payments get made via fiat currencies.
Celsius Network vs BlockFi: Safety and Security
BlockFi and Celsius Network outsource the custody of their users’ crypto assets to third parties. What do you need to know about the security of your funds with each company? Let's explore custodial services employed by each brand further.
BitGo secures Celsius Network's crypto assets along with Prime Trust, Fireblocks, Kingdom Trust, On Chain, and others.
Once upon a time, you could find the BitGo logo on the Celsius Network's website. But this disappeared about a year ago. This vanishing act has led customers to worry about whether BitGo still protects their funds.
Via Telegram, Alex Mashinksy, the CEO of Celsius Network, confirmed that BitGo is still involved in custody. But he noted that they no longer receive special treatment (e.g., display of the company's logo).
Why? Because this apparent favoritism upset the other companies providing custodial services. Some customers see this as a less transparent approach to custody. It has led to concerns about the safety of funds at Celsius Network.
What does security look like with BlockFi? Clients buy crypto within the BlockFi interest account or send it. From there, the asset gets replaced by an obligation to return the same amount of that crypto plus interest earned.
How does BlockFi pay clients interest each month while meeting withdrawal requests quickly? First, they keep a material amount of cryptocurrency available for withdrawal. These assets get stored with third parties like Coinbase, BitGo, and the Gemini platform.
Second, they buy SEC-regulated equities and predominantly CFTC-regulated futures as principal. Third, they apply risk management to their lending activities.
How do they mitigate risk to these institutions? Through collateral and credit due diligence.
Pros and cons of BlockFi
- Insured wallets by AON and stored by Gemini which is regulated in NYC, United States
- Created by reputable team with highly regarded US based investors
- Competitive interest rates with flexible, transparent terms
- No need to use or stake native currencies to get higher interest rates
- Monthly compounding interest
- No requirements for minimum withdrawal
- No monthly fees
- A single free withdrawal per month
- No minimum amount on savings accounts
- Accepts USA citizens
- Facilitation of earning interest, trading, and borrowing from a centralized hub using the BlockFi app
- Bitcoin rewards credit card
- One free withdrawal per month with a 0.0025 BTC withdrawal fee after that
- Complaints of withdrawals taking up to seven days
- Only three collateral options
- Loan terms that are limited to 12 months
- Only one option to receive a loan in (USD)
- High minimum loan amounts starting at $5,000
- Low loan-to-value (LTV) ratios of 50 percent
Pros and cons of Celsius Network
- No Minimum Deposits or Balance
- No fees
- Competitive interest rates, particularly on Stablecoins
- Fee-free, instant payments via CELPay
- Weekly Rewards. Each Monday, you'll earn interest.
- Large variety of supported cryptocurrencies
- You can two options for earning your crypto interest. You can either earn the same coin as you had deposited or earn in CEL, Celsius' native coin. Earning is CEL will earn an additional 5-30% interest.
- No web app
- Need to be paid in native currency in order to earn higher interest rates
- Know Your Customer (KYC) is required if you're looking to earn interest. This means you'll need to submit your ID and SSN.
- Interest rates can fluctuate quite a lot
- You'll only be able to use one withdrawal address for each crypto. If you wish to change, there will a 24-hour hold on your account.
- United States users will not be able to take advantage of earning in CEL.
Compare with BlockFi and Celsius Network alternatives
Similar Savings Accounts and Loans
BlockFi vs Celsius Network: The Takeaway
What's the takeaway when it comes to BlockFi vs Celsius Network? Celsius Network comes with many attributes, when it's all said and done, making it the obvious platform of choice for individuals who consider themselves more advanced cryptocurrency users.
One of Celsius Network's primary benefits remains gaining access to higher rates of interest with deposits of many more crypto assets.
That said, BlockFi comes with key features worth a second look, including the flexibility of withdrawals and deposits. It represents a fantastic option for those just dipping their toes into the crypto stream.
Are you interested in finding out more about the best platforms for buying, selling, and trading digital currencies? Here's what you need to know about the leading DeFi and CeFi platforms that offer crypto loans, lending, credit cards, debit cards, and more.