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BlockFi increases interest rates after covid-19 slump in market

BlockFi increases interest rates after covid-19 slump in market
By We Play Coins
Added on Oct 17, 2022

BlockFi increases interest rates to keep the services afloat. The recent market crash has resulted in loss of income due to the drop in value of cryptocurrencies. This move will help offset that loss.

Starting on April 1, BlockFi will be raising the interest account rates on Bitcoin (BTC) and Ether (ETH).

According to CEO Zac Prince, BlockFi users holding between 0-5 BTC now will earn a 6% annual percentage yield (APY), while those with up to 500 ETH will earn a 4.5% APY. Stablecoins like the Gemini Dollar (GUSD) and USD Coin (USDC), will retain their 8.6% APY interest rates. BlockFi increases interest rates after covid-19 slump in market

From the website

As families, communities, industries, and markets continue to grapple with our current public health climate, we wanted to share an update regarding BlockFi’s operations throughout the present period of high volatility.

Read on for details on our operational performance during this past week, and our plan of action as we move forward.

Our Rates

Our balance sheet is stronger than ever and shifts in the institutional lending markets have created opportunities that expand our margin. As a result, starting April 1st, we are raising our Interest Account rates as follows:

BTC Tier 1, 0-5 BTC, 6% APY

ETH Tier 1, 0-500 ETH, 4.5% APY

GUSD and USDC rates will stay the same at 8.6% APY

Our Operations

We have continued to maintain perfect performance across all of our lending activities with zero losses in the lending book.

Last Thursday (3/12) evening Eastern Time, there were particularly violent downward price movements in the cryptocurrency market resulting in very limited liquidity. This was handled strategically by our team and risk management system and we did not liquidate USD loan client collateral below a price of ~$4,500, despite the market reaching lows of ~$3,800. As a result of the team’s prudent actions during this period, our clients’ capital was saved and we also liquidated a smaller percentage (<10%) of our overall USD loan book vs. other market participants.

Our system has processed the largest number and volume of daily deposits and withdrawals in BlockFi’s history. Withdrawal processing is operating on our standard cycle and we remain ready to meet our clients’ liquidity needs.

Our trading product stayed up 24/7 with no downtime, providing a market that our clients could sell or buy from anytime and processed tens of millions in trading volume.

Our Team

Our client service team has been operating nearly 24/7. On a normal day, we receive 200-300 support tickets and over the last 5 days we received thousands per day. Our team has continued to answer every ticket each day, ensuring our clients receive full support at all times.

We continue to function as usual, with full remote status implemented for our entire team, and 100% availability across all our products.

All credit goes to BlockFi’s team of nearly 100 talented, dedicated professionals, who have gone above and beyond to deliver the world class product and service experience that our clients have come to expect.

Our Series B capital raise in January was well timed and BlockFi remains well-capitalized, secure, and liquid while continuing to grow rapidly.

As the global economy weathers a number of headwinds, including the coronavirus pandemic, rest assured that at BlockFi we will remain a stable source of liquidity, while continuing to provide best-in-class wealth management solutions for our clients and the broader cryptocurrency market.

Thank you,

Zac Prince

CEO and Founder of BlockFi