- BlockFi announced changes in its Bitcoin (BTC) and Ethereum (ETH) lending yields starting Feb. 1.
- Changes follow the increasing price and interest in the crypto assets.
An official announcement from BlockFi, a cryptocurrency startup that allows users to lend and earn interest on digital assets, stated the company will reduce the overall interest paid to lenders of Bitcoin (BTC) and Ethereum (ETH) starting February 1.
The changes come at a time the crypto market is experiencing tremendous growth as Bitcoin soared past $8,000 and ETH rocketed past $150, at the start of the year. According to the CEO of BlockFi, Zac Prince, the changes are set to accommodate the changes in market sentiments and price across the market. A growth in value means the lending demand is expected to hike effectively bringing the yield down. Zac said,
“As market conditions change, particularly price sentiment, this has an effect on the prices in the crypto borrowing market which is a big driver of rates that BlockFi can offer to our clients.”
BlockFi implements new yields for BTC and ETH
The report stated new rates for both BTC and ETH, the former witnessing its yield drop from 6.2% for Tier 2 (loaning up to 5 BTC) to 5.1% for its Tier 1 customers, those borrowing up to 10 BTC. The new rates will see the latter crypto cut its lending yield by 0.6% from 4.2 percent for Tier 1 customers, those borrowing up to 1000 ETH to 3.6 percent for those loaning up to 500 ETH (Tier 2).
Despite the lower rates offered, Zac maintains the company still offers the most competitive rates in the field. He said,
“Our rates are still way ahead of alternative options and we remain the only retail-focused interest-earning platform.”
The lending yields for other cryptocurrencies including Litecoin (LTC) and Gemini Dollar (GUSD) remain unmoved.
The latest move seems to be a move towards larger crypto investment in the firm as the holding/lending yield were adjusted upwards for Tier 2 investors on both BTC and ETH. Tier 2 BTC lenders will receive a percentage bump from 2.2% as ETH lenders receive 1.5% bump to 2%.
At the end of 2019, BlockFi announced trading on the four cryptocurrencies offered with zero trading fees.