The post Best DAI Interest Rates by Lisa Gibbons appeared first on Benzinga. Visit Benzinga to get more great content like this.
Want to jump straight to the answer? Hodlnaut offers among the highest DAI interest rates at over 12% APR!
With traditional interest rates at historic lows, people are turning to cryptocurrency as an alternate means to generate income. Crypto offers competitive interest rates with percentages unheard of in the traditional finance industry. By cutting down on overheads and working directly with blockchain technology, crypto platforms can offer higher interest rates. Also, these platforms often feature low- or no-minimum lock-up periods on crypto funds.
The DAI stablecoin is a decentralized, unbiased, collateral-backed cryptocurrency soft-pegged to the U.S. dollar. DAI is held in cryptocurrency wallets or within platforms and is supported on Ethereum and other popular blockchains. If you’re a long-term-oriented cryptocurrency investor, then you might want to consider earning interest on your digital assets. Using cryptocurrency to earn interest yields passive income that can augment profits if cryptocurrency markets continue to appreciate.
Many platforms offer interest-bearing accounts that pay you in the cryptocurrency you fund your account with, and these interest rates differ based on which type of cryptocurrency you choose. Hodlnaut is one of those platforms.
Contents
- Hodlnaut Overview
- Hodlnaut: 12.73% Interest on DAI
- How to Earn Interest on DAI
- Other Platforms to Earn Interest on DAI
- Risks of Earning Interest on Crypto
- Is Earning Interest on Cryptocurrency Worth It?
Hodlnaut Overview
Hodlnaut was founded in 2019 by Juntao Zhu and Simon Lee as a borrowing and lending platform. The company introduced tiered interest rates last year and launched a dedicated mobile app.
The Hodlnaut Crypto Interest Account lets users earn interest on crypto with up to 12.73% annual percentage yield (APY) on DAI in March 2022. With this platform, no lock-in periods or minimum deposits are required. The platform operates an easy step-by-step approach to earning crypto interest. It also offers one free withdrawal per month and a token swap feature. Interest from Hodlnaut is paid weekly with zero deposit fees to transfer cryptocurrencies.
Hodlnaut: 12.73% Interest on DAI
Hodlnaut offers high interest rates compared to other crypto platforms, which means that investors can generally get higher yields over time. It offers two main products, crypto interest accounts to earn high APY compounded weekly and fixed-term loans with higher yields. The user interface is friendly and easy to navigate.
DAI is quickly becoming a popular option for stablecoin users. As a decentralized stablecoin from MakerDAO, DAI is pegged to the U.S. dollar to ensure each coin is worth $1. DAI exists entirely on the Ethereum blockchain. The stablecoin maintains a consistent price compared to other cryptos. Unlike other stablecoins, no centralized authority oversees it.
A good interest rate to earn on stablecoins is typically between 6% to 9%. Hodlnaut offers exceptionally high interest for stablecoins at 12% annual interest. Other platforms offering DAI interest rates are BlockFi at 8.75% APY, Nexo at 8% to 12%, CoinLoan at 10% to 12% APY and 6.43% APY with Gemini Earn.
A number of other platforms offer tiered interest rates on the top cryptocurrencies, but Hodlnaut offers extremely competitive rates.
By way of comparison, BlockFi makes money by offering institutional and consumer loans, while Hodlnaut makes loans to corporate entities. BlockFi offers free stablecoin withdrawals. BlockFi’s primary custodian is Gemini Trust, which has built extensive security protocols. Hodlnaut offers optional insurance coverage that can provide an extra level of security for their users. New users of most crypto interest platforms are offered bonuses, but they differ widely. New users can earn up to $250 (for large deposits) when signing up for BlockFi and up to $20 when signing up for Hodlnaut (for most deposits).
get started
securely through Hodlnaut’s
website
Hodlnaut’s stated mission is to help individual investors get the most out of their cryptocurrencies. The company partners with institutions like Fireblocks, Jumio, Nexus Mutual and Okcoin to make stable crypto investing possible.
Best For
- Anyone who wants to save for the future
- Crypto owners who don’t want to be active investors
- Investors looking to diversify their portfolios
- Quality interest rates for savings accounts
- Easy navigation and a powerful mobile app
- Information for the novice crypto owner up to the advanced trader
- Not FDIC or SIPC insured
- Customer service team isn’t available via phone
How to Earn Interest on DAI
Looking for the easiest way to get started earning interest on your DAI crypto? Check out this quick, step-by-step guide.
- Open an online account.
To get started, open an account with a platform that allows you to earn interest on your crypto holdings.
Before depositing funds to Hodlnaut, new customers create an account, log in and complete an identity verification process. The process is fairly straightforward and requires basic personal information for the Know Your Customer (KYC) process.
Both Hodlnaut and BlockFi are great options if you’re new to crypto and want to earn interest on your cryptocurrency. The platforms currently offer between 8% to13% annual interest rates compounded monthly, depending on which cryptocurrency you use.
Another platform that allows you to earn interest on your cryptocurrency holdings is Celsius Network. This platform has some of the most competitive rates for stablecoin interest-bearing accounts at around 11% annual percentage rate (APR), which is roughly 3% higher than BlockFi’s stablecoin interest rates and 10% higher than Coinbase.
- Purchase cryptocurrency.
As soon as your account is verified, deposit your funds and purchase crypto. All the platforms recommended above have instant deposits so that you can start trading immediately. You may have to wait until the deposit clears before you can transfer cryptocurrency off the platform.
Hodlnaut supports 5 cryptocurrencies that can be transferred including Bitcoin, DAI, Ethereum, Tether and USDC. Hodlnaut offers no option to deposit fiat currency and convert it into crypto. However, it sets itself apart from the competition by offering some of the best interest rates available for cryptocurrencies, which makes it highly attractive for crypto holders.
If you don’t already have a personal hardware or software wallet, you should get one to use decentralized finance (DeFi) platforms like Hodlnaut. Hardware wallets are safer than software wallets. Ledger and Trezor rank as two of the most secure wallet brands.
- Earn interest on your DAI.
No minimum deposit is required when you set up a Hodlnaut account, and no lock-in period is imposed, meaning that DAI investors can withdraw funds at any time. The Hodlnaut platform also provides an interest calculator that helps users to calculate the interest they will receive.
Once you’ve added funds to your interest account, you’ll start earning interest. Earning interest in cryptocurrency is particularly attractive to cryptocurrency investors who believe the price of Bitcoin and other cryptos in the long term.
Other popular cryptocurrencies that investors can earn interest on include Bitcoin, Ethereum and Polygon. Risk-averse investors may find certain interest-bearing cryptocurrency investments intriguing, specifically stablecoins like DAI and USDC.
Other Platforms to Earn Interest on DAI
Gemini is one reputable platform offering the opportunity to earn interest of approximately 6.43% on DAI crypto. DAI holders can deposit their DAI into the DAI Savings Rate contract and earn a yield on their DAI. The DAI Savings Rate is a floating interest rate set by Maker token holders. If the market price of DAI is above $1, Maker holders can vote to decrease the DAI Savings Rate in an attempt to reduce demand for DAI and lower its market price towards $1. Other options include:
CoinLoan: 1% – 12% APY
Nexo: 8% – 12% APY
YouHodler: 12.75% APY
BlockFi: 8.75% APY
get started
securely through Nexo’s
website
Nexo is a unique lending platform that allows you to earn interest on your cryptocurrency investments. Interest rates vary by distribution method and coin, but you can expect to earn between 6% and 12% APR. Nexo is based in Switzerland, which makes it less vulnerable to increasing U.S. regulation of crypto lending platforms.
Nexo also allows you to take out loans based on the amount of cryptocurrency in your account without selling your coins and buying them back. Interest rates for loans begin at 5.90% APR. Though you cannot currently buy or sell cryptocurrencies through the Nexo platform, the crypto savings account provider offers a high-yield method for investors to earn money on idle coins and fiat.
Best For
- Long-term cryptocurrency investors
- Those who already hold a stablecoin or alt-coin
- Beginners who are new to cryptocurrency savings accounts
- High-yield savings accounts earn up to 12% interest on coins and fiat currencies
- Comprehensive mobile app makes management simple
- Advanced security features and insurance
- Fewer educational resources than some competitors
get started
securely through BlockFi’s
website
Maybe you think cryptocurrency is the future, or perhaps you were swept up in the initial waves of Bitcoin. BlockFi may be your next step if you’re ready to evolve as a crypto investor.
Whether you’re a native crypto user or curious enough to start investing, BlockFi seeks to bring institutional-grade financial products to crypto markets that often face restricted access. It strives to bring clients low-cost, simple applications designed to maximize the potential of crypto assets. Learn more in our BlockFi review.
Best For
- Crypto native clients
- Crypto curious clients
- Mostly fee-free platform
- Market-best interest rates
- Earn interest, trade and borrow from a centralized hub using the BlockFi app
- Mostly restricted to those with a base knowledge of cryptocurrency
- No dedicated relationship with an investment advisor, so best for those who have a solid handle on crypto trading
get started
securely through YouHodler’s
website
YouHodler is the next generation of fintech applications that helps people benefit from the growth of cryptocurrency through crypto-backed loans.
The company’s payment solutions enable users to trade cryptocurrency or place funds into a checking account drawing up to 12.3% plus compound interest. YouHodler lends out your currency, and you earn interest when you buy and hold. It pays interest on 33 different currencies such as the USDT, USDC, PAXG, BTC, ETH, and DOGE.
Retail customers use assets for crypto lending and earning higher interest rates through their accounts.
Best For
- Saving
- Crypto loans
- Exchange
- Crypto investing
- High-interest savings accounts
- Crypto-based loans
- Crypto trading and exchanging
- YouHodler is not available in the U.S. and China.
Risks of Earning Interest on Crypto
Interest paid on crypto holdings differs from interest paid on savings or money market accounts from a centralized bank. Centralized bank interest poses no risk to your principal from trading unless the bank itself were to default or go bankrupt. Although crypto interest rates can be higher than those in the world of traditional finance, returns over time face risk to principal, are more difficult to predict and face a high level of volatility. High-interest digital assets carry a degree of risk. Additionally, the low regulatory oversight and decentralized nature of the crypto industry makes it susceptible to scams. Also, if the cryptocurrency that you hold depreciates, so does the interest you’ve earned.
Is Earning Interest on Cryptocurrency Worth It?
Cryptocurrencies have a high risk profile that regulated fiat money does not. Although you can earn high rates of return, none are guaranteed. However, if you already own cryptocurrency and are a believer in the future of cryptocurrencies, then earning interest on cryptos may be a way of capitalizing on the value of your digital assets.
Crypto interest accounts allow crypto holders to invest in digital currencies with the hope that these cryptos will increase in value over time.
And, when compared to traditional bank accounts, crypto interest accounts offer much more attractive yields. When investing in any cryptocurrencies, it is a good idea to do thorough research and evaluable the risks.
The post Best DAI Interest Rates by Lisa Gibbons appeared first on Benzinga. Visit Benzinga to get more great content like this.
