The crypto market has seen better days. However, despite the current market volatility, many investors are keeping their eyes on the long-term. A good number of them are looking for where to deposit their assets to ride out the bear market, and most are turning to crypto lending platforms.
Nevertheless, there are many players in this industry. If you have narrowed your choices down to BlockFi and Crypto.com, you are probably wondering which one would serve you best.
Both BlockFi and Crypto.com offer several attractive features that may appeal to you in varying degrees. We'll compare both platforms based on their core products, interest rates, security, and additional features to help you decide the best fit for you.
What is BlockFi?
BlockFi is a reputable US-based crypto lending company that offers a good avenue to earn above-average yields on crypto assets. It launched in 2017 with the goal of using its extensive product offerings to serve the unbanked individuals.
The platform offers opportunities to earn interest or passive income through its interest accounts. You can also take out instant crypto-backed loans and trade on its crypto exchange. BlockFi supports over 35 assets, including BTC, ETH, and major stablecoins, and users can also collect crypto rewards through its credit card.
Since its launch, BlockFi has grown significantly. It currently caters to over one million users, with more than 800 employees working with the company. It also has digital assets valued at over $10 billion.
The platform is popular among users for its competitive interest rates and zero transaction fees. It also prioritizes security and employs adequate safety measures to protect users' funds.
BlockFi Core Products and Features
As already established, BlockFi offers several products and features, including savings accounts, crypto-backed loans, exchange, and other additional features. We'll discuss these features in detail below.
Crypto Interest Accounts
BlockFi enables users to earn passive income through its savings and interest-yielding accounts. You only need to deposit any of the platform's supported cryptocurrencies into an interest account to start receiving yields as high as 8.3%.
Your deposit starts accruing interest the day after you make the deposit and will be paid monthly. You can decide the preferred cryptocurrency to receive your yields and withdraw your deposit at any time.
BlockFi uses deposits secured in its platform to offer loans to borrowers at a fee. This useful service allows you to access funding if you urgently need cash and do not intend to sell off your crypto holdings just yet.
Interestingly, this type of loan does not require credit checks or lengthy processes, as is the norm with traditional lending services. To secure the loan, you only need to deposit crypto collateral depending on your preferred loan-to-value (LTV) ratio. On BlockFi, you can access between 20% and 50% LTV.
BlockFi receives crypto collateral in Bitcoin, Ethereum, Litecoin, or PAX Gold holdings and issues the loan in fiat or stablecoins such as GUSD and USDC. Loan duration can be between 6 and 12 months.
However, note that a 2% origination fee will apply to this service. You can also take advantage of BlockFi's flexible loan term to pay back your debt at any time without penalties. Once you pay off your accrued interest and principal loan amount, your collateral will be released.
BlockFi has one of the best exchanges in the industry offering users opportunities to trade crypto for free. You can buy, sell, and swap supported assets and access other portfolio management tools through the crypto exchange.
When you buy cryptocurrency assets through the platform's exchange, it lands in your interest account and starts earning interest immediately.
There are over 35 crypto assets supported on BlockFi. This includes popular assets like BTC, ETH, LINK, LTC, PAXG, USDC, USDT, BUSD, and GUSD, the proprietary token of the platform's custodian, Gemini.
Interest rates on BlockFi savings accounts can be anything between 3% and 8.3%. This depends on the type of asset and amount deposited.
The platform uses a 15-tiered interest rate system to determine how much interest you can receive on your crypto deposits. Also, note that interest rates on certain coins can drop when you deposit assets beyond specified thresholds.
Borrowing interest rates can fall between 4.5% and 9.75%, depending on your LTV.
BlockFi Rewards Credit Card
One feature that sets BlockFi apart from other crypto lending platforms is its Rewards Credit Card. This product is similar to regular credit cards, meaning it allows users to make purchases anywhere.
However, instead of other kinds of rewards and cashback as is obtainable with other credit cards, the BlockFi card rewards users with cryptocurrency. You can receive 1.5% cashback in BTC for everyday purchases made using the card.
This cashback can also go up to 2% if you are a big spender. You simply need to hit an annual threshold of $50,000 to start enjoying the higher rate.
It is worth noting that this reward arrangement is mostly useful to users who want to accumulate cryptocurrencies in anticipation of a price surge. If there is a surge in the price of BTC, users earn more from these rewards.
While BlockFi allows for free transactions on its trading platform, there are other fees associated with activities on the platform.
The platform offers one free crypto withdrawal every month, after which you must pay to make extra withdrawals. The fee depends on the cryptocurrency you are withdrawing. You will also pay a 2% origination fee and the accrued loan interest when you take out a crypto loan through BlockFi.
BlockFi adopts most of the important security measures to secure users' funds. You must enable two-factor authentication to withdraw funds or effect any change on your BlockFi account. The platform supports email and SMS authentications.
Also, Gemini, which is BlockFi's primary custodian, holds up to 95% of the platform's assets offline in cold wallets. Gemini is reputable and has been operating in the industry for almost a decade.
Unlike traditional finance institutions, deposits in BlockFi do not have SIPC or FDIC insurance. However, while Gemini keeps 95% of BlockFi's assets in cold storage, the remaining 5% held in hot wallets are insured by AON. The company uses the funds in the hot wallet to facilitate daily activities on the platform.
- US-based, secure, and regulated.
- Universally available except in sanctioned regions.
- No monthly fees or transaction fees.
- No minimum deposit.
- Crypto rewards for credit card users.
- Flat fee for second and subsequent withdrawals monthly.
- Long withdrawal times.
- High interest on loans.
- Limited assets.
- Not suitable for users with large crypto holdings.
Read the full review: BlockFi Review: Pros and Cons. Is BlockFi safe?
What is Crypto.com?
Crypto.com is a top crypto exchange offering a suite of crypto-related services. It is one platform that closely mirrors a traditional bank but serves the crypto community.
The platform was established in 2016 and has remained reputable as a place to start one's crypto journey. It offers a one-stop shop for everything related to digital assets and supports over 250 currencies and 20-plus fiat currencies.
Like other crypto lending platforms, Crypto.com offers instant loans and allows users to earn interest on cryptocurrencies deposited in the platform's interest accounts. Crypto.com also offers digital wallet services and crypto Visa cards in addition to its fully-functional exchange.
Unlike BlockFi, Crypto.com has a native token, CRO, which is used to access extra benefits on the platform. Its debit card users are also rewarded for making purchases with the card according to their CRO holdings.
Crypto.com Core Products and Features
We have already identified most of Crypto.com's core features and products. However, this section presents the details of how they work.
Crypto Interest Accounts
Crypto.com offers crypto savings accounts where you can deposit your crypto assets to earn high yields. Your interest starts accumulating as soon as you deposit your assets and is paid into your crypto wallet weekly.
You can use the interest deposited in your wallet as soon as it arrives with no restriction. Also, you'll receive your interest payout in the same cryptocurrency you deposited.
You can also access crypto credit on Crypto.com using your assets as collateral. The platform offers flexible crypto-backed loans with a 25%, 33% and 50% loan-to-value (LTV) ratio. There are no penalties if you choose to repay your loan at any time within the loan term.
Users can borrow funds for up to 12 months. However, the minimum loan amount is $100. While interest rates may be higher on Crypto.com, they are lower when you stake the CRO token.
This is the most prominent feature on Crypto.com. The exchange allows users to buy, sell, and trade cryptocurrencies with support for many assets.
Interestingly, the CRO token benefits also extend to transactions on the exchange. You'll receive discounts on transaction fees if you hold CRO tokens in your Crypto.com wallet and buy coins with them.
The CRO token was launched in 2018 as the native token of the decentralized and open-source blockchain, Cronos Chain, developed by Crypto.com as part of the company's solutions to make cryptocurrencies mainstream. The token is used within Crypto.com to offer users lower loan rates, discounts, and additional benefits.
The token was recently rebranded as Cronos, but its CRO ticker remains unchanged. You can also trade the token on several other exchanges in the industry.
Crypto.com supports over 250 cryptocurrencies and more than 20 fiat currencies, including the Australian dollar (AUD), Canadian dollar (CAD), euro (EUR), pound sterling (GBP), U.S. dollar (USD), and Brazilian real (BRL), thereby offering flexibility and agility for users in purchasing crypto with local currency.
Popular cryptocurrencies are available for trade on the platform, including Bitcoin, Ethereum, Litecoin, Dogecoin, Polygon, Cardano, USD Coin, Binance USD, Tether, and others.
Crypto.com offers up to 14.5% APR on interest accounts for users staking the platform's CRO token. However, you can get crypto-backed loans at as low as 1% APR if you stake over 100,000 CRO, with a 25% LTV. A higher LTV and lower CRO token stake will increase your loan APR.
Crypto.com Visa Card
Crypto.com offers a Visa debit card that makes it convenient to spend crypto. The service allows you to add your digital assets to the card and spend it on purchases anywhere.
The platform offers free conversion from the assets added to the card to fiat money needed to make purchases at the prevailing market price. You can also get cashback rewards if you stake CRO tokens.
Crypto.com charges no fee for deposits on the platform. However, withdrawals attract a fee unless you use the withdraw to App function.
You can settle transaction fees using the receiving cryptocurrency, or the fee may be withdrawn automatically from your CRO balance if you have sufficient assets and the function is enabled. Note that transaction fees paid with CRO tokens attract discounts up to 50%.
Like other platforms, Crypto.com maintains a decent level of security to ensure users' confidence in the platform. It enables multi-signature technologies and whitelisting to protect users' accounts from criminal activities. The platform also gets regularly audited by Bureau Veritas.
Crypto.com holds 100% of its assets in cold storage and runs its daily activities with corporate funds held in hot wallets. These measures are put in place to ensure that hackers do not gain access to users' funds deposited on the platform.
Crypto.com has the largest insurance provision among crypto lending platforms. It has set aside around $750 million to cover the platform's assets. This means that all deposits made on Crypto.com are highly secured.
- High-interest rates on savings accounts
- Native token with tons of benefits
- Largest insurance of $750 million
- Wide range of supported cryptocurrencies
- Visa debit card
- Must stake CRO tokens to access the platform's perks
- High fees
Read the full review: Crypto.com Review: Pros and Cons. Is Crypto.com safe?
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BlockFi vs Crypto.com: Which Is Best For You?
Crypto.com and BlockFi are quite different in their offerings and operations. Therefore, your choice will depend on what you are looking for.Crypto.com has more products in its suite, which makes it a good option if you need to handle all your crypto needs on one platform. The platform also supports more assets than BlockFi and has a debit card for easy crypto spending.
However, if you want to invest in high-yield interest accounts and access fair loan rates without staking a platform's native token, BlockFi might make more sense to you. Also, the platform's simpler nature makes for more usability than Crypto.com's over-sophisticated platform.