It's safe to say that the financial world hasn't been the same since the introduction of new technologies like blockchain and decentralized finance. These cutting edge opportunities have bred a variety of innovative platforms, including BlockFi and Nexo.
As an investor, particularly one unfamiliar with cryptos and blockchain tech, it can feel intimidating to choose the best platform for your financial needs. After all, each one comes with a compelling list of features.
Where to start? Let's breakdown and compare two of the top choices in the crypto lending space today, BlockFi vs. Nexo. That way, you'll gain a better sense of which platform's right for you.
Founded in 2017, BlockFi is licensed and registered in the United States and headquartered in New Jersey. Headed up by its CEO Zac Prince, BlockFi has offered interest account services to users since 2019, earning a solid reputation in the process.
The company has raised significant capital from notable venture capital firms focused on blockchain tech companies, such as Coinbase and Galaxy Digital. The company's customer base includes both retail level and institutional grade investors.
Now that you've become more familiar with BlockFi's company history as well as pros and cons, let's take a closer look at Nexo. Nexo is a subsidiary of the traditional online finance lending company Credissimo and was founded in 2007.
Both Nexo and Credissimo are licensed and regulated by the European Union. They're headquartered and staffed out of the EU.
In 2018, Nexo users first gained access to Nexo's initial coin offering (ICO). In the process, Nexo raised $52 million. What does Nexo's customer base look like today? It consists primarily of retail investors and blockchain-focused businesses.
Like BlockFi, Nexo boasts a user-friendly interface with streamlined account creation. You have access to customer support through live chat, and the company also keeps a detailed product support page and FAQs page.
Comparing BlockFi and Nexo
We need to highlight several factors when comparing these two crypto platforms. They include:
- Customer experience
- Interest account rates
- Interest account assets
- Interest account fees and terms
- Special features
- Security and safety
By looking at each of these companies in light of the areas listed above, a picture of the superior platform will emerge based on your unique financial needs and assets.
BlockFi vs. Nexo: Customer Experience
Today, BlockFi offers customers an easy-to-use platform that starts from the moment of account creation. Interest payments get instantly credited to each user's account, and BlockFi prides itself on having readily accessible customer support via email and telephone.
BlockFi keeps an up-to-date and robust product support page and FAQs page. That said, the company's biggest downfall at the moment is the lack of a mobile app. If you prefer transacting on your phone or tablet, this marks a significant issue.
Nexo boasts robust mobile applications that you can access on both iOS and Android. Of the two companies, this makes Nexo the more convenient option for many users.
After all, there are more than five billion mobile phone users alone in the world today. This stat represents a growth in users of more than 102 million in the past year!
BlockFi vs. Nexo: Interest Account Rates
BlockFi and Nexo both come with competitive interest rates based on their supported assets. That said, the best choice for your current needs will be based on a variety of variables, including the assets upon which you wish to earn interest.
BlockFi offers the industry best on interest rates at 6.2 percent APY on account balances of up to ten Bitcoins (BTC). The company boasts the industry best for interest account balances of up to 1000 Etereum (ETH) at 4.1 percent.
What about altcoins like the Gemini Dollar (GUSD) and USD Coin (USDC) interest account balances? You'll enjoy no minimum or maximum restrictions or requirements. That said, the biggest drawback when it comes to BlockFi remains its inability to support fiat currencies.
How does Nexo stack up when it comes to interest account rates? The company offers an eight percent APY on account balances in the following coins:
You'll also see an eight percent APY on these fiat currencies:
These rates apply to account balances of up to $2,000,000. But you'll have to wait if you're interested in altcoins such as Ripple, Ethereum, and Bitcoin. While the platform has announced interest accounts for these coins, they're not currently supported.
What else do you need to know about Nexo, apart from this short Nexo review? Here's where to start your research.
BlockFi vs. Nexo: Interest Account Assets
When it comes to BlockFi and Nexo, each company deserves a partial pass regarding interest account assets. After all, both companies have only been in business for a handful of years.
Nevertheless, both platforms should up their games in the coming years to stay relevant. Here's what each platform currently supports.
BlockFi transacts in both Gemini Dollars (GUSD) and USD Coin (USDC) stablecoins. They boast supported crypto assets such as Ethereum (ETH), Bitcoin (BTC), and Litecoin (LTC).
As for Nexo? The most considerable drawback remains no supported crypto assets. As for supported stablecoins? They include USDT, USDC, TUSD, DAI, and PAX.
You'll also enjoy fiat interest accounts available in EUR and GBP. As you can see, there's no clear winner when it comes to interest account assets. That said, Nexo has made some announcements about crypto assets, but we have to wait and see if these are fulfilled through available interest account products.
BlockFi vs. Nexo: Interest Account Fees and Terms
When it comes to interest account fees and terms, we all know what lengths traditional finance companies have undergone to "hide" these figures. In keeping with their mission to create a more transparent financial realm, BlockFi and Nexo are both very transparent about their fees and terms.
For example, BlockFi's compound interest is included and paid monthly. There are no minimum balance amounts needed, which means you can start with as little as $1 in your account.
BlockFi applies a rate of 2.2 percent to the remainder of all balances above ten Bitcoins for interest accounts. It applies a 0.5 percent APY to balances surpassing 1000 Ethereum (ETH) for all Ethereum interest accounts.
The company accepts US customers, and no maximum account balance restrictions apply. You may withdraw your assets at any time without facing penalties, another welcome amenity. That said, you'll only receive one free withdrawal each month, so use it wisely.
As for Nexo, compound interest on account balances gets paid out every day. There are no minimum balance amounts required, and you can begin with a $1 minimum.
The maximum account balance for Nexo is $2 million. The company accepts US customers, and interest account holders may withdraw their assets at any time, penalty-free. Overall, this makes Nexo the clear winner in this category.
BlockFi vs. Nexo: Special Features
The best FinTech companies establish competitive advantages by providing unique features to their customers. These features may vary greatly, and benefits should be assessed within the context of your unique financial needs.
That said, BlockFi offers a program known as Interest Payment Flex, which permits users to choose to receive credited interest payments in Bitcoin, Ethereum, or Gemini Dollar. This approach proves convenient for a specific subset of the investor population.
They also offer a generous referral program, which is continually getting updated and worth further exploration. Last but not least, the platform facilitates trade directly between crypto-assets.
As for Nexo? You won't have a referral program to take advantage of. But the platform offers GBP and EUR fiat interest accounts with high-yield APY.
BlockFi vs. Nexo: Security and Safety
Security and safety represent vital consumer concerns. After all, 2019 saw many hacking incidents, confirming the fear that crypto and blockchain tech can get compromised.
How does each company compare when it comes to keeping your assets safe and secure? Unlike many other organizations, BlockFi never ran an Initial Coin Offering (ICO).
The company is licensed in the US and boasts strong institutional backing from venture capital firms, including Coinbase and Galaxy Digital. It relies on the insured custodian Gemini Custody to maintain and secure customer accounts and balances.
Security measures include two-factor authentication. BlockFi claims their asset balance sheets only get lent to trusted institutions and corporations.
Nexo falls back on the reputation of its parent company Credissimo, in operation since the late 2000s. Deloitte audits Credissimo's financial statements, and Nexo claims that customer's deposited crypto assets are insured by Lloyd's of London to the tune of $10,000,000.
Like BlockFi, Nexo also offers two-step authentication for account holders.
Some red flags exist when it comes to the overall security of assets in Nexo, though. For starters, the company ran an Initial Coin Offering (ICO) to raise capital. There have also been hard-to-ignore reports detailing unethical behavior on the part of Credissmio.
Have these unethical behaviors impacted Nexo? It's tough to tell.
Nexo doesn't maintain the same control over its asset balance sheets as BlockFi. For all of these reasons, BLockFi represents the obvious winner when it comes to security and safety.
Besides this brief BlockFi review, here's what else you need to know about this company.
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 Nexo
- $375 million insurance and custodied with Ledger Vault
- Easy to use app and website.
- Support for business accounts.
- Nexo’s information security management systems are ISO/IEC 27001:2013 compliant after extensive audits, inspections, and checks by CISQ, a member of IQNet and the world’s largest provider of management system certification.
- Full flexibility — no lock-in periods, withdraw at any time.
- No withdrawal, transaction, or platform fees.
- Earn 30% extra interest when earning with Nexo tokens.
- High levels of asset liquidity.
- Free Nexo card for daily transactions.
- Over 4 billion processed and 1+ million clients.
- No hidden fees.
- No credit score checks.
- Guaranteed approval.
- Nexo's crypto brokerage service offers 75+ crypto & fiat pairs. It also offers zero price fluctuations when user places an order.
- Nexo mandates holding NEXO tokens to receive the best loan and savings rates.
- The $375 million insurance is cumulative for all clients, and it only applies to assets that are kept in cold Ledger Vault wallets.
- Even though Nexo does not mention re-hypothecation anywhere, it seems like it's applicable.
- In some cases, lender interest rates are higher than borrower rates.
Compare with Nexo and BlockFi alternatives
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Frequently asked questions about BlockFi
We’ve compiled some answers to questions we often get. Should you have any other questions, feel free to reach out below in the comments.
How often does BlockFi pay interest?
BlockFi pays interest once a month, compounding on your previous month‘s interest.
Can I earn interest on fiat currency with BlockFi?
BlockFi doesn’t pay interest on fiat currencies, however, they do offer up to 8.6% APR on GUSD. GUSD is a stablecoin backed by US Dollars. This means that for every GUSD, it is backed by one USD. This is a great option for people who want the stability of a fiat currency like USD, but the savings interest rates of crypto currency.
Where is BlockFi based?
BlockFi is based in NYC, New York, United States. It’s team is based their and most of their investors and advisors are based in the United States.
Will applying for a BlockFi account hurt my credit score?
Absolutely not. BlockFi won't do a credit check on you because your loan is based on collateral. It won't effect your credit score at all.
Who can I contact if something goes wrong?
BlockFi offer real-time chat and email at firstname.lastname@example.org. You can also call them on 646.779.9688
Can I earn interest in GBP or Euros with BlockFi
Which countries does BlockFi support?
The BlockFi Interest Account isn't available to sanctioned or watchlist countries. It's also not available in New York, Connecticut, Washington, and Wyoming. BlockFi is available everywhere else.
Does BlockFi have Two-Factor Authentication?
Yes, BlockFi offers Two-Factor Authentication. It won't be set up by default, however, you can easily switch it on in the settings. If singing up with BlockFi, we highly recommend setting this up.
How often does BlockFi's interest compound?
BlockFi's savings accounts offer monthly compounded interest. If you withdraw within a given month, you will not receive the interest earned during that month.
Does BlockFi have an app?
Not yet, however, they tell us it's in the works and will be available in the coming months.
Is there a maximum amount I can deposit to BlockFi
No, BlockFi doesn't have any maximum deposits.
Does BlockFi have minimum deposits?
No, BlockFi don't have any minimum deposits.
Will I lose my interest for a given month if I withdraw?
No. BlockFi now offers to pay your interest on a pro-rata basis if you withdraw during a month in which you're earning interest.
How long does it take to withdraw funds?
It can take up to 7 days to withdraw funds, however, in practice it's usually in one business day
What is the duration of a BlockFi loan?
They are 12 months, however, there is no prepayment penalty.
Frequently asked questions about Nexo
We’ve compiled some answers to questions we often get. Should you have any other questions, feel free to reach out below in the comments.
How Does It Work?
As their slogan suggests, Nexo supports you to bank on crypto. Lending with this platform, you can earn 12% interest that compounds and pays out daily. If you borrow on the platform, you will have a starting APR of 5.9%.
On top of all this, you make your deposits and withdrawals whenever you like without limits. And for automatic approvals, there are no credit checks. The platform supports over 40 fiat currencies in over 200 countries of supported transaction locale.
How to Borrow Cash With Nexo?
You can instantly borrow fiat from Nexo by using crypto as collateral. As mentioned earlier, they support over 40+ currencies, and you can spend it how you like with your method of choice or with a Nexo card.
Once again, to borrow, login to your account. Select supported crypto and "Top Up". Send your crypto to the address and you're set. It's the same process as lending crypto.
Behind the deposit, you will see your credit line, which you can use instantly. You can transfer to a bank or use it with your Nexo card. With the Instant Crypto Credit Line, you can make use of a variety of crypto to back your loan. This ensures that you are less vulnerable to crypto volatility
Nexo provides a 50% discount on the final amount. If your outstanding balance is within the loan limit, you don't need to make monthly payments. Once you fully repay the loan, you can withdraw your assets from the wallet. You can also choose to start a new line of credit with the collateral.
When it comes to loan limits, it's determined by the market value of your assets used as collateral. If your assets increase in value, the Nexo Oracle (Nexo AI) will increase your loan limit automatically.
How to Use Your Crypto On Nexo?
Before you can deposit your digital assets, you have to confirm your personal details. Without verification, you will not be able to borrow or lend fiat or crypto. You will also be able to see the interest rates.
Start by logging in or creating an account on Nexo. After this, choose the crypto that you prefer and "Top Up". Send your digital assets to the secure address and you're all set.
Nexo will display your balance and how much you can earn. You have the ability to withdraw whenever you like without fees and penalties. When you deposit your crypto, you will also see your open credit line.
Is the Nexo debit card available yet?
The Nexo Card is not available to most people just yet. It’s something they’ve been working on for a couple of years now. Some of the features include 2% cash back. What’s best about this is that you can even choose whether you receive it as Bitcoin or Nexo tokens.
What fiat currencies and crypto coins and tokens Nexo support?
How can I deposit funds to Nexo?
Depositing funds to Nexo is quite simple. Select one of the supported cryptocurrencies and it will generate a private deposit address. Copy it & paste the copied address to the "withdraw address" option of the wallet or exchange that you are using to transfer funds to Nexo and click on the withdraw/send button. That's it as soon you will receive the funds in your Nexo wallet/account after the number of network confirmations is reached.
BlockFi, Nexo, and Your Assets
As you can see, there's a lot to weigh when considering BlockFi vs. Nexo. You'll need to take a careful look at your short- and long-term asset goals as well as the level of risk you're willing to stomach.
Ready to learn more about platforms such as BlockFi and Nexo so that you can find the best one for your current financial needs? We've got you covered. Check out our snapshot of the leading DeFi and CeFi platforms.