The Guide to Earning Interest with Crypto Savings Accounts

Anything written on this blog is purely for entertainment purposes only and should not be used as legal, financial or medical advice. Investing is inherently risky—please do your own due diligence.

For the past two years, I’ve been earning more than 8% interest in a little pocket of the internet. Why did I do this? To get higher return for my money compared to what traditional banking would give me.

Despite pre-Covid interest rates above 1% APY, I knew that my money was already losing its value due to inflation.

Attempting to get a return with crypto had its risks, yet I felt like the trade offs was worth the experiment:

High yield savings accountsHigh yield crypto interest accounts
Measly interest under 1% APY (as of Oct 2020)Interest up to 12% APY
Safe with FDIC protectionTypically no insurance nor protection
Easy money movementMay have to move money around a few times to “realize” interest earnings.

The strategy: Allocate some of my money sitting in low-interest, FDIC-backed savings accounts into higher-interest, unprotected cryptocurrency accounts.

Specifically, I’ve been earning this interest with stablecoins which are cryptocurrencies pegged to a (more) real assets like gold or the U.S. dollar. You can read more about stablecoins on Wikipedia.

Interested in potentially getting higher interest by buying and holding cryptocurrencies? You’ve come to the right place to learn. But cryptocurrency and investing Stablecoins and crypto have their inherent risks, so consider yourself fairly warned.

I used to recommend BlockFi as my go-to for earning interest with crypto, but they are going through some new changes. Instead, I now use Stablegains as my predominant crypto “savings” account. You can read my Stablegains review here.

The exact steps to earn interest on cryptocurrency

If you already have crypto in accounts like Coinbase or Blockchain.com, there’s a chance that some of your crypto may already be earning interest. So…job done?

However, traditional crypto exchanges are a bit slow on the high interest game. Even though Coinbase is a co-creator of the USDC stablecoin, they only offer ~1.25% interest compared to the 8.6% interest on BlockFi.

I’ll walk through the steps typically required in the process of earning interest on crypto, then show you how my recommended solution dramatically simplifies the process.

Step 1: Acquire cryptocurrency (stablecoins)

The first step depends on whether you already have cryptocurrency, and whether the place that crypto is stored is offering any crypto.

If you don’t have cryptocurrency, consider reading my crypto starter guide here. If you want the fastest way to get started earning an interest rate on crypto, keep reading the rest of the steps.

Here’s a quick cheatsheet on what you can do depending on your scenario:

Do you have crypto?Does your account give interest?Then do this:
Yes I have cryptoYesNice! Keep it where it’s at, or move it somewhere to earn higher interest
Yes I have cryptoNoTry moving some of your crypto to interest-bearing accounts.
I don’t have cryptoN/ASkip to BlockFi recommendation

But heads up—not all cryptos earn interest. The top ones that do are either Bitcoin, Ethereum, and popular stablecoins.

Due to their liquid nature and lower volatility (compared to traditional crypto), you can typically earn higher interest with stablecoins. Here’s a table of interest offered on BlockFi, pulled on Oct 18, 2020:

CurrencyAmount **APY
BTC (Tier 1)0 – 2.56%
BTC (Tier 2)> 2.53.2%
ETH> 05.25%
LTC> 05.0%
USDC> 08.6%
GUSD> 08.6%
PAX> 08.6%
PAXG> 04%
USDT> 07%
Here’s a table of interest offered on BlockFi, pulled on Oct 18, 2020. The stablecoins in bold offer the highest interest rates.

There’s a plethora of stablecoins out there, but I’ll mainly be recommending USDC and GUSD, which are created and backed by U.S. based companies that I trust — Coinbase and Gemini, respectively.

Step 2: Put your crypto somewhere that earns interest

The crypto wallet or exchange you’re on may or may not be offering interest on its deposits. If the crypto wallet or exchange already provides interest, like Coinbase or Blockchain.com, you may choose to not do any extra work and observe what earning interest in crypto feels like.

The famous Coinmarketcap has an earn interest page that breaks down where to earn top interest rates based on the cryptocurrency you already have.

Surf around long enough and you’ll find a few repeating names crop up like BlockFi, Celsius Network, and Nexo.

I ultimately decided to trust my money and crypto with BlockFi.

You can scroll down to this section to read an detailed account of why I chose them over other competitors. and will show you a comparison table why:

Step 3: Earn interest on your crypto

This is the fun part. Watch your money grow!

Screenshot from BlockFi account

Most crypto platforms will pay you interest in the crypto that you deposited. Example: If you deposit $1000 worth of USDC, you’ll earn 86 USDC (8.6% interest) 1 year later.

*Useful feature* BlockFi allows you to choose the currency you want to be paid interest in. You can choose GUSD for easy withdrawal later, or Bitcoin if you think that’s going to collect the most value.

This is all gravy if you just want to ride the interest train. If you want to realize your gain$ in US dollars, I’ve got you covered in the next step.

Step 4: Convert crypto back to dollars (optional)

If cryptocurrencies still feel less tangible to you, and you want to get real dollars out…it’ll might take a few transfers.

To do this, you’ll need an exchange where you can sell your cryptocurrency and get it back in fiat currency (USD).

Here’s an illustration of how that works in BlockFi:

Putting money inTaking money out
Make a free, bank transfer (ACH) of dollarsWithdraw money using a normal ACH bank transfer.
BlockFi automatically converts your USD deposit into the GUSD stablecoin, or Gemini Dollars.Use the free ACH bank withdrawals, or for bigger amounts use a wire transfer (which has a fee though).
Your GUSD stablecoin will earn 8.6% in interest, compounded monthlyYour money is automatically converted 1:1 from GUSD to USD into your connected bank account.

The negative part? Withdrawals may come with fees, like BlockFi’s $0.25 charge withdrawing stablecoins to other crypto exchanges.

Gemini currently has free withdrawals for their native currency.

At the end of the day…If I really needed to get money out into USD, I trust BlockFi’s existing infrastructure to do it…not one of the other European startups that prioritize Euros/British pounds #sorrynotsorry

Conclusion: Try out some of these crypto interest platforms

Reading steps 1-4 should give you a sense of the process of earning interest with crypto.

When I first wrote this article in November of 2020, BlockFi was the obvious winner in terms of ease of use and trust. Currently, BlockFi is pausing the opening of new interest accounts as it transitions to a new product post regulatory approval.

Here are 3 options I recommend.

(easiest to use)
(most reputable)
Celsius Network
(high stablecoin rates)
15% APYUp to 8.6% interest—see ratesUp to 12% interest—see rates
U.S. based, Y Combinator backed startupU.S. Based Team that you can contact by phone.U.K.-based team, has phone support.
Simple web and mobile app. Feels a bit barebones, ACH and repeating transfers are a warm welcome.Smooth web experience that works just as expected right out the gate. Simple ACH (bank) transfers.No easy bank linking (yet), will have to pay fees for depositing via wire or ACH. However, all crypto transfers are free.

To see all the other platforms I’ve tried (and get a referral bonus), check out my Top Crypto Bonuses page.

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