BlockFi vs Crypto.com

James HeadshotAuthor: James Page
Last Updated: October 2020

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The next big thing in the fintech and crypto industry is definitely crypto interest platforms. These are usually lending companies that support a number of crypto assets and stablecoins which users can store and accumulate interest on.

These interest accounts are very similar to a savings account that you would otherwise create through your regular bank account. The difference is that you’re depositing cryptocurrency and that these services are decentralized.

In the wake of the 2020 pandemic, savings accounts offer lower interest rates than ever. Today, we’ll discuss two crypto interest platforms – BlockFi and Crypto.com and their attractive client-oriented and high yielding services as an alternative in these troubled financial times.

About the Providers

BlockFi

BlockFi is one of the most popular crypto interest and lending platforms around the globe. Launched in 2017 in New York City, the company has since then expanded its offices in New Jersey, Poland, and Argentina.

BlockFi is the brainchild of online lending experts Zac Prince, BlockFi’s current CEO, and Flori Marquez, SVP of Operations. They’ve teamed up with Chief Risk Officer Rene Van Kesteren to build a platform that would focus on bridging the gap between traditional banking services and the crypto industry.

At the start, BlockFi offered basic credit services while working on adding a suite of borrowing and lending options and was even the first US platform to offer crypto-backed loans to retail and institutional investors.

BlockFi is famous for its Crypto Interest Account and its high-yielding interest rates with compound interest on top. Traders are now able to trade cryptos without any extra fees and store their coins on the same platform to gain interest.

The leading New York trust company, Gemini, is BlockFi’s primary custodian. Gemini was founded by the well-known Winklevoss twins and is regulated by the NYSDFS.

Moreover, BlockFi has incredible institutional backing from companies like Valar Ventures, Morgan Creek, ConsenSys Ventures, Galaxy Digital, Fidelity, Akuna Capital, SoFi, and Coinbase Ventures. Their financial help has been crucial for BlockFi’s growth and development.

Crypto.com

Crypto.com was primarily created as a cryptocurrency exchange by a stellar team of experts including Bobby Bao, the Head of Corporate Development, the platform’s CTO Gary Or, the current CEO Kris Marszalek, and Crypto’s CFO Rafael Melo. It was launched in 2016 and headquartered in Hong Kong.

The platform is best known for its revolutionary product, the first crypto-backed prepaid Visa Card that lets customers spend their cryptocurrency or fiat and earn rewards, cashback from 1% to 8%, Netflix and Spotify reimbursements, and more in exchange for staking Crypto’s native token, CRO.

However, Crypto.com is more than just a regular crypto exchange. Their Earn program, for example, lets customers earn interest from holding onto their cryptos. There are a couple of different holding terms and tiers to choose from based on your investment capital.

Crypto.com vs BlockFi: The Comparison

Bitcoin (BTC) and Other Cryptocurrencies

BlockFi supports the most prominent cryptos, from the number-one “digital gold” — Bitcoin (BTC), to the second-largest crypto by market cap — Ether (ETH), the silver to Bitcoin’s gold — Litecoin (LTC), and a number of stablecoins: Paxos, PAX Gold, USD Coin, Gemini Dollar, and Tether (USDT) (only available to non-US users).

BlockFi doesn’t allow buying cryptos with fiat currencies. Instead, users can trade one digital asset for another. The closest to a crypto-to-fiat trade is trading against stablecoins because they’re pegged to an existing fiat currency (e.g. Gemini Dollar is pegged at a 1:1 ratio to the US Dollar).

BlockFi has recently added a trading option that allows users to swap between different cryptos without any additional fees. Although fiat to crypto exchanges aren’t available yet, exchanging your cryptocurrency for stablecoins might be an even better alternative. These assets are closely pegged to fiat currencies like the US Dollar and allow investors to maintain price stability while still transferring their money faster and cheaper than they could with fiat currencies.

Crypto.com, on the other hand, offers typical crypto exchange services (with a twist!). The platform supports 7 fiat and over 80 cryptocurrencies (including stablecoins, altcoins, ERC-20 tokens, and native CRO tokens). You can purchase them via bank transfer, debit card, credit card, or make crypto to crypto trades. You can instantly send cryptos to users of the Crypto.com App at zero cost.

You can pay a small withdrawal fee to transfer your crypto to an external wallet. If you decide to use the Crypto.com App wallet, you’ll pay no deposit, exchange, or transfer fees.

Crypto.com and BlockFi Interest Accounts

BlockFi and Crypto.com both have an Interest Account that allows users to deposit their target cryptocurrency and accrue interest payments to grow their investments over time. Why not let your assets do some work for you while they’re sitting in your wallet?

BlockFi supports interest payments on all cryptos and stablecoins on its list of supported coins, with different interest rates. You get your interest on the first day of each month and you can choose the currency in which the interest will be paid. For example, if you earn interest on your BTC holdings, you can receive interest payments in ETH.

BlockFi’s main drawcard is the compound interest feature. This means that your cryptocurrency earns interest on the initial interest!

On Crypto.com, you can deposit one of the following cryptocurrencies to your Earn Account regardless of your location: CRO, BTC, ETH, LTC, XRP, BNB, BAT, LINK, MKR, DAI, PAXG, ATOM, BCH, VET, ICX, ADA, ENJ, ALGO, KNC, ERD, COMP. Everyone except traders from Singapore can deposit PAX, TUSD, TAUD, TGBP, and USDC. Some US States lack support for EOS, XLM, XTZ, and CELR deposits, while no US citizens are allowed to deposit USDT and OMG.

Once you make a deposit, you must choose a holding term that works for you. The options are flexible holding, 1-month fixed term, or 3-month fixed term. Crypto.com doesn’t offer compound interest.

You receive your accumulated interest once a week, only in the deposit currency.

Interest Rates

BlockFi has really competitive interest rates. What’s more, when the COVID-19 pandemic hit the financial market, the company didn’t lower its rates. In fact, it even managed to raise some of its interest rates to help customers make ends meet.

The current interest rates are as follows:

BTC (Tier 1) 0 – 2.5 6% APY
BTC (Tier 2) > 2.5 3.2%
ETH > 0 4.5%
LTC > 0 5.0%
USDC > 0 8.6%
GUSD > 0 8.6%
PAX > 0 8.6%
PAXG > 0 4%
USDT > 0 7%

In comparison, Crypto.com has different rates based on the cryptocurrency and holding term you’ve chosen. For example, Bitcoin holdings earn 1.5% APR (Annual Interest Rate) with flexible holding, 3% with 1-month fixed holding, and 4.5% with 3-month holding.

Crypto.com users can earn up to 2% higher APR rates if they stake CRO tokens on the platform. For example, CRO stakers enjoy the following Bitcoin APR rates with flexible, 1-month, and 3-month holding respectively: 2 %, 4.5%, and 6.5%. Stablecoins earn up to 12% with a 3-month holding.

Fees and Limits

BlockFi doesn’t have any minimum or maximum deposit limits on Interest Accounts. Both retail and institutional investors can enjoy the benefits of accumulating interest, no matter the size of their investments.

BlockFi gives users one free withdrawal per month but otherwise incurs the following fees:

  • 0.0025 BTC for Bitcoin withdrawals with a maximum limit of 100 BTC per week.
  • 0.0015 ETH for Ethereum withdrawals with a limit of 5,000 ETH per week.
  • 0.0025 LTC for Litecoin withdrawals with a limit of 10,000 LTC per week.
  • $0.25 USD for stablecoin withdrawals with a limit of 1,000,000 stablecoins per week.
  • 0.0025 PAXG for Paxos Gold withdrawals with a limit of 500 PAXG per week.

Until recently, BlockFi used to charge a withdrawal termination penalty if a user withdrew assets from his/her account prior to the last day of the month. Luckily, the company saw that this was chasing customers away to other less limited platforms and removed the fees.

On the other hand, Crypto.com has minimum deposit limits for Crypto Earn. For example, the minimum Bitcoin deposit is 0.025 BTC, 1 ETH on Ethereum deposits, and 5 LTC on Litecoin deposits.

Crypto Loans

When money is tight, crypto investors reach for their crypto holdings and sell them for fiat. Until recently this was their last resort because crypto-backed loans weren’t an option. Cryptos were considered too volatile to be used as collateral.

All this changed with BlockFi’s pioneering loans that allow customers to monetize their BTC, ETH, LTC, or PAXG to borrow USD. The platform then loans these cryptos to reputable investors and businesses at a higher interest rate. This way, you won’t give up on your digital assets and avoid capital gains tax (paid when selling crypto for profit).

If the price of the crypto collateral nosedives significantly, BlockFi will inform the users to either pay down the loan or increase the collateral.

Crypto.com has a similar feature called Crypto Credit where instead of borrowing fiat currencies, users borrow stablecoins (USDT, PAXG, USDC, or TUSD). The Credit Health indicator monitors whether the collateral is at risk of being liquidated based on your current Loan-to-Value (LTV) Ratio. The minimum loan amount is $100.

Security

We can guarantee for BlockFi’s security because the platform has Gemini as its primary custodian. Gemini is regulated by the NYDFS and was the first exchange to complete the SOC 2 Type 1 examination in 2019.

Crypto.com has secured insurance policies worth $360 million from direct and indirect coverage through various custodians to provide protection for its cold storage. The platform was the first crypto exchange to earn certifications for Privacy Risk Management, Information Security Management, Payment Card Industry: Data Security Standard, and Cryptocurrency Security Standard.

Both BlockFi and Crypto.com perform KYC checks on all their customers and ask them to activate two-factor authentication when their accounts are approved.

Ease-of-Use

User reviews recommend BlockFi to crypto novices because of its easily-navigable interface. It’s a beginner-friendly platform with a detailed help center and FAQ questions that explain how their services work. There are no minimum deposit limits and hidden fees. You have more flexibility on your interest earnings and don’t have to stick to some predetermined holding terms.

Crypto.com has a slight learning curve because it’s tailored towards a more experienced clientele who can afford to meet their limits and holding tiers. Crypto.com is a trading platform so it also offers Stop-Limit, Stop-Loss, Take-Profit Market, and Take-Profit Limit orders.

Both platforms are web-based but offer mobile apps to manage your crypto investments on the go.

Customer Support

Apart from consulting their support and help centers with detailed answers to users’ most frequent questions, you can direct your more urgent queries to BlockFi’s email address or send a telegram to Crypto.com.

Crypto.com has a live support chat but users have complained about the low responsiveness. That’s not the case with BlockFi as users can contact their team on the phone as well. They’re quite vocal on social media and present in the media.

Pros and Cons

BlockFi Pros

  • No minimum deposits on interest accounts and no deposit fees.
  • Offers high-interest rates and compound interest.
  • Customer funds have insurance coverage thanks to BlockFi’s custodian Gemini.
  • Allows users to choose the cryptocurrency they want to earn interest in.
  • Users can withdraw their funds whenever they want and get one free withdrawal per month.
  • Great for beginners.

Crypto.com Pros

  • A wide variety of supported cryptocurrencies and stablecoins.
  • You receive interest weekly instead of monthly.
  • Features a variety of order types.
  • All customer funds (100%) are kept in cold storage.

BlockFi Cons

  • Offers a smaller number of crypto assets for purchase and storage.
  • Distributes the interest payments monthly instead of weekly.

Crypto.com Cons

  • You can only earn interest in the deposited currency.
  • You can’t earn compound interest.
  • The platform has high minimum deposit limits.
  • It’s not beginner-friendly.
  • You have to stake CRO tokens for higher interest rates.

Final Thoughts

Even though crypto interest platforms are venturing in brand new territories, we can see that both BlockFi and Crypto.com have put a substantial effort into the financial services they provide for crypto investors.

Hopefully, if you followed this guide with interest, you would feel confident enough to decide whether or not these platforms have what it takes to grow your crypto investments.

If you’re looking for a two-in-one crypto exchange and interest platform, have previous experience in the crypto industry, and don’t mind the restrictions and limits – you can choose Crypto.com.

If you’re simply a retail investor interested to make some passive income, you probably need lower tiers and greater customization. In that case, BlockFi has exactly what you need.

FAQ

What’s the difference between Crypto.com App and DeFi Wallet?

Crypto.com App wallet is a custodial crypto wallet that takes care of your private keys for you. Although you have to rely on the platform’s security measures for the keys’ safety, this wallet takes the responsibility of safeguarding the private keys off your shoulders. It’s integrated with the exchange, so you can both trade and transfer money from one interface.

The DeFi Wallet is non-custodial or user-custodial, i.e. you have full control over your private keys. However, if you lose your recovery phrase, you’ll lose your coins forever. Plus, unlike Crypto.com App, transfers via DeFi Wallet incur certain fees.

What are the benefits of crypto lending?

Crypto lending involves private individuals or institutions lending their crypto assets on online P2P platforms that play the role of intermediaries and businesses or private individuals borrowing those assets. The biggest benefit for retail crypto investors is that they don’t have to sell their holdings and miss out on potential price gains. Moreover, selling your crypto for profit is subject to capital gains tax.

Can you earn compound interest on Coinbase?

Yes. Coinbase has partnered with BlockFi to allow you to earn compound interest on your cryptocurrency indirectly. What this means is that once you purchase crypto from your Coinbase account, you can immediately send them to your BlockFi wallet address, and start earning interest. Coinbase supports a variety of payment methods including card purchases which is why it’s so popular with traders worldwide.

Can you earn crypto interest on Ethereum?

Yes! Both BlockFi and Crypto.com support Ethereum (ETH), the second-largest cryptocurrency, so you can easily deposit your ETH coins and earn interest income on your holdings. Other popular platforms like Celsius Network and Nexo let you earn crypto interest on Ethereum.

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About The Author

James Page

James Headshot

James is the main editor. With a passion for finance and anything blockchain, cryptocurrency is right up his alley. He's responsible for most of the content on the site, trying his best to keep everything up to date and as informative as possible.

Disclaimer: Digital currencies and cryptocurrencies are volatile and can involve a lot of risk. Their prices and performance is very unpredictable and past performance is no guarantee of future performance. Consult a financial advisor or obtain your own advice independent of this site before relying and acting on the information provided.