As the inflation rates increase, investors seek ways to outpace them by investing in alternative assets. In the past, investors used gold as a haven for storing value during inflation. However, things have changed, and modern investors turn to crypto assets like Bitcoin to keep economic value.
Buying and keeping Bitcoin might be an excellent investment strategy. However, you can grow your investment portfolio if you learn ways to earn interest from this cryptocurrency. Here’s how you can make an interest in Bitcoin.
Use a Cryptocurrency Lending Platform
A lending platform is a site that allows you to lend your cryptocurrency to other users and earn interest from it. The venue will usually match the borrower with the right lender, and they will agree on the loan terms.
The most popular lending platforms are:
- Blockfi: Blockfi is one of the largest crypto lending platforms. It offers up to 8.6% Annual Percentage Yield or APY on BTC deposits and 6% on ETH deposits. You can also earn interest on other cryptos like LTC, PAX, USDC, and GUSD.
- Nexo: Nexo is another top crypto lending platform that offers up to 12% APY on BTC deposits. You can also earn interest on stablecoins like USDT, USDC, DAI, and TUSD.
- Celsius Network: Celsius Network is a bit different from the other platforms since it allows you to borrow cash against your crypto holdings. It offers up to 30% APY on BTC deposits.
To earn interest on Bitcoin, buy the currency on a platform like Bitindex Prime and then deposit it into one of these lending platforms. Once you do that, the platform will loan out your BTC to other users and pay you interest.
Compare different platforms and choose one with the highest APY to maximize your interest in crypto lending. Blockfi and Nexo are the two biggest lending platforms, but Celsius Network might offer a higher interest rate depending on your currency.
Invest in a Bitcoin Savings Account
Another way to earn interest on your Bitcoin is by investing in a savings account. These are similar to traditional savings accounts but with crypto assets. BlockFi offers the most popular BTC savings account.
With this account, you can deposit your BTC and earn up to 8.6% APY. The savings account also comes with other benefits like no withdrawal fees, no deposit fees, and low minimum deposit requirements.
To start earning interest on your BTC, sign up for an account with BlockFi and deposit your Bitcoin into it. Once you do that, the platform will pay you monthly interest on your holdings.
Staking entails holding Bitcoin in a cryptocurrency wallet to support the network and earn rewards. The most popular crypto asset for staking is Bitcoin, and there are several ways to do it.
The easiest way to stake BTC is using a service like Blockfi or Nexo. These platforms allow you to bet your BTC and earn interest from it.
Another way to stake BTC is by using a validating node. But this involves running a full node and then betting your BTC on it. Doing this will earn you block rewards in the form of BTC.
The downside of this method is that it requires technical expertise and can be costly. For example, you need a powerful computer and enough BTC to meet the minimum deposit requirements.
These are some of the best ways to earn interest on your Bitcoin. Crypto lending platforms like Blockfi and Nexo offer the highest interest rates, but staking your BTC can also be profitable. Regardless of the method you choose, research it extensively before investing any money. And always remember to diversify your portfolio to minimize risk.