Yeah I probably got lucky (or whatever), mine is great, has 5 metro locations, has a solid website and decent app.
I respect your opinion but I feel 100% comfortable with it there. It’s absolutely risky and I dipped my toe in before putting anything meaningful on the platform. They’re on the up and up, trying to go public and they also have a ton of strong backers like Coinbase, SoFi, and Peter Thiel.
As you said though - it’s not a HY savings account but I’m fine with that.
How can they pay 8.6% interest and not lose money? What’s their income source to offset this?
I’m a degenerate so I’m interested, maybe I’ll move my savings over to BlockFi.
I’m guessing the catch is that the account is not FDIC-insured.
So does that mean that they can basically just keep putting all the USDC people are holding into Bitcoin and if the price of Bitcoin tanks, they can peace out and just not pay when people wanna cash out?
Tesla now 6th largest company in the world behind Apple, Saudi Aramco, Microsoft, Amazon, and Google.
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BTC right back on track, 40k.
They issue loans.
Yep
Digital currency is not legal tender, is not backed by the government, and the BlockFi Interest Account (BIA) is not a bank account nor a brokerage account, and is not subject to FDIC or SIPC protections.
My brother had some similar arrangement in Australia a few years ago (got it through working in merchant banking). He invested $50k and made 13.5% p.a. for three years before he sold out.
TIL: a ‘rational bubble’ is a thing?
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One of the most prestigious journals in economics!
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Dude, its your money but this is one of the worst investments I’ve ever seen, and I’ve seen some extremely terrible investments.
Yeah the risk to reward ratio is baaaaaad.
But Crypto! It’s like Uber but for money!
I’m just a lurker in this thread, but it seems to me like the “where should I keep my cash savings” and “bank vs. credit union” conversations would fit better in the thread that (I think) was spun off for that very reason?
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Listening to this right now and still trying to wrap my head around the content, but the podcast guest is the developer of Strike, which appears to be a kind of transaction layer built atop the Bitcoin network enabling free, instant, global transactions not just in bitcoin, but any local currency, and without being limited to using any exclusive payment services like PayPal, etc.
If legit, sounds like it resolves many of the arguments for why BTC is impractical. And if so, it further boosts bitcoin’s use case.
Hopefully someone more financially savvy than me can listen and chime in.
I might listen to this, however, most times when the developer of something is the one touting its merits, it’s often nothing more than smoke blowing.
Are you suggesting there is bullshit, on the internet?
How dare you good sir!
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Unless I’m missing something, BlockFi’s financial model makes no sense. They pay a higher rate on deposits 6%+ than they charge on loans - per their website they offer loans with interest as low as 4.4%.
Their disclosures state that:
“In order to pay our clients crypto interest on a monthly basis and to meet withdrawal requests on a timely basis, we engage in a number of activities, including (1) keeping a material amount of digital assets available for withdrawal with third parties such as Gemini, BitGo, and Coinbase; (2) purchasing, as principal, SEC-regulated equities and predominately CFTC-regulated futures and (3) applying risk management to the lending activities in the institutional market.”
It sounds like they take peoples crypto then generate returns by using those funds to trade equities and futures. Thus, it sounds like they are not holding all their deposits in crypto, so they would be short crypto and likely are getting crushed by the spike in prices.
Again, I could be missing something about their model, but I see a huge chance anyone lending them money is going to lose quite a bit (and as noted it’s not insured, so you have zero protection on your principal).
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I feel like so many of the people who are trying to justify BTC’s current valuation assume that other assets and asset prices are rationally priced at all times.
Hell, in my lifetime, the Imperial Palace of Japan was considered to be worth more in Real Estate value than the combined value of all Real Estate in the state of California.
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Yeah I’m in no position to judge, but it sounds interesting.