The cryptocurrency world has provided developers, investors and traders with an opportunity to avail themselves of lots of options to earn passive income. Just by holding crypto patients investors can make a good profit over the years. However, there are many other ways to increase the stack of crypto assets in this market, you should know about.
In addition to staking, crypto savings accounts allow retail investors to multiply their crypto assets by earning interest on their deposited assets on some specific crypto platforms when they agree to lend their coins or tokens.
Crypto interest accounts are attractive because they deliver much higher returns compared to traditional bank savings accounts, given that the average interest rate in a crypto savings account can be as high as 7.5% against an average of 0.06% for traditional bank savings accounts.
The difference in rates is significant but comes with a higher risk. In this article, we’ll explore more about crypto savings accounts, crypto interest rates, and the risks associated with them.
What is a crypto savings account and how does it work?
A crypto saving account or interest account is typically a service of a DeFi platform that lets you earn interest on digital assets you deposit and agree to lend out in exchange for returns. It seems similar to a bank savings account which will lend your money to other customers or financial institutions for a specified period of time and give you interest for that service.
By depositing your assets into a crypto interest account, you give the platform the right to use your assets for any purpose, from lending them out to staking them on your behalf. Lending out will be their primary option to earn higher returns, some of which will be paid to you as regular interest payments.
Risks with Crypto Saving Account
This industry is mostly unregulated, so you as an investor may have no cover in case something goes wrong with your assets.
These savings accounts also don’t offer any government-backed deposit insurance like the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA) for your assets.
Platforms that are offering interest accounts may limit how quickly you can withdraw your assets and in times of difficulties, they may not allow clients to withdraw their assets at all.
How to invest in a crypto savings plan?
- Choose a platform that offers realistic interest rates;
- Create an account and open a suitable crypto interest or saving account.
- Deposit your cryptocurrency assets into a savings account on the chosen platform;
- Choose whether you want to deposit your assets for a limited time or choose a flexible time frame that will allow you to withdraw your crypto at any time;
- Start earning interest from day one.
The process is simple, but finding a reliable and profitable platform is hard. However, there are some reliable platforms we already know about.
Meet Crypto Bank
Crypto Bank is the perfect alternative to the traditional banking system. It allows the user to save and stake their cryptocurrency assets and also provides interest at the best market rates.
With savings accounts at Crypto Bank, you can earn interest up to 12% APY or you can also use staking and mining activities to multiply your funds fast. Additionally, with Crypto Bank’s staking option you can earn up to 20% APY.
At Crypto Bank, there are endless opportunities for crypto holders to earn and grow. Visit the official website to learn more about supported cryptocurrencies and interest rates on savings and other opportunities.
