6 Best Crypto Interest Accounts 2022: Who Pays the Highest APY?

10 mins read
6 Best Crypto Interest Accounts 2022: Who Pays the Highest APY?

Cryptocurrency interest accounts are an experiment that challenges various traditional yield generation strategies.

  • The S&P 500 averaged around 10% to 11% per year since 1926
  • Real estate averages around 9.4%.
  • Most popular cryptocurrency interest accounts offered around 6-12% on holdings. 

However, many crypto interest account providers such as Celsius, Voyager, and Hodlnaut either failed to disclose the risks of their revenue-generating activities or were forced to pause customer withdrawals and file bankruptcy proceedings, placing hundreds of millions of dollars of user funds in limbo.

The following article covers the top cryptocurrency interest accounts available today, and we’ll also explore the long-term feasibility of the niche.

Before we get started:

  1. With a handful of the largest crypto interest account providers filing for bankruptcy within months, we caution our users to view any crypto interest account with a high degree of skepticism. 
  2. That being said, several providers still haven’t faltered in adverse market conditions. They have their fair share of challenges; many are currently in discussions with regulating authorities to make their offerings more compliant and disclose risks accurately. 

So, are cryptocurrency interest accounts legit? Are they worthy of your assets and time? Are they safe? Why is this the best darn cryptocurrency interest account review on the Internet?

We’re honored to be part of your due diligence on the top cryptocurrency interest account. We’ve interviewed most of the leadership teams of these companies directly, and our community of CoinCentral Insiders has used or regularly used these platforms. Anyone in the CoinCentral community is welcome to email us or reach out on social media if their experiences contradict our written work. 

Do your research and understand the risks of digital assets– specifically when they are custodied by a third party. While cryptocurrency interest accounts often draw comparisons with savings accounts, they aren’t the same thing– the crypto accounts are operationally different and come with unique risks– as seen with the catastrophe of Celsius. 

The following guide on the best crypto interest accounts will cover:

    1. How crypto interest accounts function
    2. The highest APY crypto interest accounts 
    3. The easiest to get started with
    4. The highest sign-up crypto interest account bonuses

A Rough History of Crypto Interest Accounts

2020 and 2021 saw a proliferation of crypto interest account competitors, all claiming to provide sound risk management, safe and secure lending practices, and advertising quick and easy withdrawals at any time. Users flocked to these accounts, and many upstarts began spinning out similar offerings.

2022, however, saw the crypto interest account niche essentially get nuked.

In February 2022, BlockFi, the leading crypto interest account, ceased all BlockFi Interest Account offers and paid $100 million in fines to the SEC and 32 states.

In May 2022, Terra, a $60 billion DeFi ecosystem featuring Anchor’s yield-generating app, collapsed. Anchor paid roughly 20% APY in Terra UST stablecoin, and it was being used by several scrappy crypto interest accounts to generate yield for their customers. 

Celsius, the second largest crypto interest account, halted all withdrawals, swaps, and transfers on June 13th, 2022, and filed for bankruptcy soon after. Voyager soon followed. 

In August 2022, Hodlnaut paused all customer withdrawals. 

Many of these providers will be looked back on in infamy, not for potential malevolence (no money was stolen) but certainly for ineptitude and failure to disclose risks appropriately to their users. 

The ones that remain, however, have a significant opportunity to do the crypto interest account business model the right way, and fill the void. 

What Makes a Top Cryptocurrency Interest Account?

We take the following criteria into account: 

    1. Notable investors and advisors. A company’s investors and partnerships will help navigate regulatory complexities and guide business growth.
    2. Leadership team. As the cryptocurrency ecosystem grows, so do the reputational stakes. Each platform should have the human firepower to accomplish its ambitious mission. 
    3. Security measures. How safe is your money in a cryptocurrency interest account? What precautions are taken to keep funds secure?
    4. Ease of use. How quickly can one sign up and start earning APY?
    5. Rates. The top rates for crypto interest accounts will always change– which provider can you rely on to be on the upper tier of the spectrum?

Crypto “Savings” Accounts Vs. Regular Savings Accounts: FAQ

Before you move a single Satoshi or stablecoin, you must be clear on a few aspects of cryptocurrency interest accounts.

Is a cryptocurrency interest account risky? Given the events of 2022, cryptocurrency interest accounts seem at a much higher risk than they did in prior years. Although the platforms covered in this article go through extensive security protocols and have yet to experience a hack for funds, there are still risks involved with holding digital assets and trusting their custody to third parties. Don’t put in anything you cannot afford to lose. 

Are cryptocurrency interest accounts FDIC insured? No. Most U.S. bank accounts are covered up to $250,000 by FDIC insurance, cryptocurrency accounts are not. Digital assets such as Bitcoin, Ethereum, and even fiat-pegged stablecoin deposits such as USDC, GUSD, and USDT aren’t covered by FDIC insurance. Federal insurance wouldn’t cover any loss of funds due to theft. 

A cryptocurrency interest account should be viewed as an investment, not a savings account. 

Some cryptocurrency interest account platforms are secured by private insurance– and many services are launched around protecting the custody of funds. Celsius, for example, has insurance from its custodial BitGo– it is also working to launch private insurance within its platform. However, don’t bank on this insurance. It’s enough to cover some losses, but certainly not some catastrophic loss of funds. 

Are cryptocurrency interest rates guaranteed? No, but they do tend to stay within parameters. 

Do I need to only use one cryptocurrency interest account? No. Many of these accounts offer comparable rates, some users might find value in spreading their eggs over a few baskets. This diversification also helps mitigate some risks if an individual platform loses funds.

Many accounts also have “caps” on higher amounts of cryptocurrency, so using multiple platforms is a yield maximization strategy.

What are the highest-paying sign-up bonuses available? These accounts compete to acquire users, so plenty of fairly high sign-up bonuses are available– we’ll explore below. 

How Do crypto interest accounts work? How is paying high interest on cryptocurrency deposits sustainable? How do cryptocurrency interest account companies make money? Cryptocurrency interest account providers claim to make money by lending user deposits, much like a traditional bank. You can also get a cryptocurrency loan from any provider; People borrow crypto for multiple reasons: get more leverage on their trades, the simplicity of a one-stop crypto loan versus the traditional loan path, and not wanting to liquidate their cryptocurrency assets, likely for tax purposes. Our primary focus for this article is the interest account. 

There are a few notable leaders in the cryptocurrency interest account space. 

Crypto.com– The Complicated One (But Can Be Worth It)

The Hong Kong-based Crypto.com was founded in 2016; it lists four co-founders: CEO Kris Marszalek, CFO Rafael Melo, CTO Gary Or, and Head of Corporate Development Bobby Bao.

The company offers a Visa debit card, an app exchange, an instant loan product, and a cryptocurrency “crypto earn” product. 

Crypto.com offers higher than average rates, provided you lock your deposit up for three months, buy and stake (lock-up) 25,000 CRO (about $2,000). It’s a strong option, but we found the Crypto.com experience excessively complicated. If you wanted to go “all in” on the Crypto.com ecosystem, you would enjoy some of the highest rates, but there are many more hoops to jump through than its competitors. 

You can get $25 USD as a signup bonus on Crypto.com

Abra– The Daily Compounder

Abra –  Abra allows users to earn around 8% and 4.5% interest on stablecoins and Bitcoin, respectively, with as little as $5.

Best of all, it’s compounded daily. 

You can read our full Abra review here.

Nexo– The One You’ve Probably Seen Ads For

Nexo seems to cater its services to a European base of customers. Nexo uses BitGo as its custodian, a company backed by Goldman Sachs and is CCSS Level 3 and SOC 2 compliant. Nexo’s token, NEXO, provides holders a share of 30% of the company’s profits. 

CoinCentral readers can get $25 when signing up and depositing $100 or more on Nexo.

Nexo was founded in 2018 and is led by CEO Antoni Trenchev.

The site’s communications lean heavily on its lending model; optimistically, this points to the company developing a sustainable business model fueled by lending. 

It has an “Earn in Nexo” option similar to Celsius’s (Earn in CEL), from which users get about a 2% boost per asset. Without the “Earn in Nexo” option, Nexo customers can earn around 10% APY on stablecoins, which is a higher return than BlockFi but lower than Celsius. Nexo also offers an XRP interest account.

The platform seems to cater its services to an international crowd, and it can be an excellent option for our readers in Europe. 

Get $25 when signing up for Nexo when signing up with $100 or more.

You can read our Nexo review here.

BlockFi– The Venture Capital Darling (Crypto Interest Product is Currently Inactive)

BlockFi

The NYC-based BlockFi was founded in 2017 by Zac Prince and Flori Marquez. The company has attracted a star-studded line of venture capital investments, raising over $508M from Valar Ventures (Peter Thiel-backed), Winklevoss Capital, Galaxy Digital, ConsenSys Ventures, Morgan Creek Digital, and more. 

On February 14th, 2022, BlockFi paid the SEC $100 million in penalties for “failing to register the offers and sales of its retail crypto lending product.” The SEC also charged BlockFi with violating registration provisions of the Investment Company Act of 1940.  

On the same day, BlockFi suspended new accounts for US clients. US clients can still apply for the BlockFi Credit Card and open a non-interest bearing BlockFi Wallet account. Assets in the Wallet account are not loaned out or rehypothecated. 

You can read our full BlockFi review here, and sign up for the BlockFi Wallet here. 

What is the Best Cryptocurrency Interest Account Platform?

We’ve used many of the services above for over three years, opened various customer support queries to gauge response, and interviewed founding teams. 

Things looked different when we first wrote this article in 2020– BlockFi and Celsius were offering north of 10%, Crypto.com could be gamed for 14% APY on stablecoins, and most competitors were competing on rates.

Today, many of these accounts are playing it a bit closer to the cuff on the tailwinds of BlockFi’s $100 million payment in penalties to the SEC. Many of the prior top providers are now on the Wall of Shame of CeFi companies that fumbled a great opportunity to build a meaningful product and lost millions of dollars of users’ money in the process. 

That being said, many international providers like Nexo and Crypto.com seem to have an advantage.

Abra, Crypto.com, and Nexo good crypto interest options. Abra offers daily compounded interest, which is unique in the space. With 8% interest on stablecoin deposits and a very intuitive interface, it’s a strong choice for anyone looking to start earning interest on their cryptocurrency. 

What is the highest APY cryptocurrency interest account?

The highest APY cryptocurrency interest account is crypto.com… but there’s a catch, as we’ve outlined above and in detail in our Crypto.com guide.

The Top Cryptocurrency Interest Account Promotions

The following crypto interest account promotions are active, but subject to change. We’ll do our best to keep these updated, but get them while they’re hot if you want them. 

Crypto.com: Sign up and get $25 USD to sign up for Crypto.com. You may have to stake 2500 CRO (about $200)– the promotion isn’t clear.

The Wall of Shame

Celsius – The Bankrupt CeFi Platform Fallen from Grace

Celsius was founded in 2017 by Alex Mashinsky (CEO), an NYC-based entrepreneur with over $3 billion in exits and two of NYC’s top venture-backed exits since 2000. Mashinsky claims Celsius was founded on the premise of bringing 7.5 billion people from the traditional world of finance into the cryptocurrency sphere.

During its normal operations, Celsius offered some of the highest yields in the CeFi crypto interest account niche, paid weekly, with no lock-up period, or token requirement. The Celsius team boasts a return of 80% of company revenue to users.

However, on June 13th, 2022, Celsius halted all withdrawals, swaps, and transfers and declared bankruptcy a month later. The company had originally disclosed it was primarily involved in lending user deposits, but it was unearthed the company was using user funds in various risky DeFi strategies. Amid a downward spiral of crypto prices, Celsius found itself in highly illiquid positions, unable to honor user withdrawals.

We will update our review as more information is released. 

Given this new information, we do not recommend signing up for Celsius. The company, however, is interesting to follow as a piece of cryptocurrency history.  

You can read our full Celsius review here. 

Final Thoughts – Are Cryptocurrency Interest Accounts Worth It?

If you’re someone looking to diversify your portfolio by buying and holding cryptocurrency, we strongly recommend checking out cryptocurrency interest accounts for yourself. 

Have this conversation with a financial advisor, and feel free to send them this article as a basis for the discussion. Cryptocurrency interest accounts like BlockFi and Celsius are investments, and the returns are not guaranteed. Our content is purely educational and informational; a  single dollar or satoshi shouldn’t leave your wallet without professional advice. As evidenced by the implosion of Celsius Network, any custodial account is risky in a bear market. 

That being said, we’re a fairly paranoid editorial team that acknowledges the “be your own bank” and “not your private keys, not your bitcoin” ethos of the cryptocurrency industry. 

The world’s best crypto interest accounts try to cater to user security, but at the end of the day, any time your funds leave your hardware wallets, you’re in the hands of the digital world. The risk is yours, and yours only, to make.

Before we let you go, let’s leave this idea: if more digital asset holders are comfortable keeping their funds on a cryptocurrency interest platform, placated by relatively low-risk decent returns, volatility may decrease in the long run. With digital assets like Bitcoin seen as less volatile due to fewer people selling Bitcoin, the case for institutional capital to enter the ecosystem becomes much stronger.  We believe cryptocurrency interest accounts are a small, but very important part of maturing cryptocurrency as an asset class. 

You can check out our individual reviews on platforms like:

  1. BlockFi
  2. Celsius
  3. Abra
  4. Crypto.com
  5. Hodlnaut

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