Ally Bank CD Rates – Up to 0.80% APY!

editorial staff
April 2, 2021

Ally Bank is an acclaimed digital bank that offers a suite of competitive FDIC-insured online savings products including CDs, savings accounts, interest checking and money market accounts.

[You can read a review of Ally Bank’s money market account and its current APY here.]

In this review we’ll focus on Ally Bank’s fixed-rate, certificates of deposit. They have seven standard term CDs ranging from 3 months to 5 years that can be opened as standard CDs or IRA CDs. They also have two promotional CDs – the “Raise Your Rate CD” and the “No Penalty CD.”

The Raise Your Rate CD is beneficial in an ascending interest rate environment. This product gives you the opportunity to increase your rate once over a 2-year term or twice over a 4-year term if their rate for your term and balance tier goes up while your CD is active.

The No Penalty CD, as the name implies, allows you to withdraw any amount at any time after the first six days of funding the account. You can keep the interest earned with no penalties.

For those that may not remember, Ally Bank is the rebrand of GMAC – the financial arm of General Motors. Following the financial collapse of 2008, GMAC fully rebranded to Ally Bank in 2009. Since then they’ve been recognized for numerous awards for online banking innovation, customer service, and their commitment to giving back to local communities.

Ally Bank CD Rates + Account Details

As mentioned, Ally Bank has seven standard term certificates of deposit that come with no minimum opening deposit requirements. The terms range from 3 months to 5 years and come with annual percentage yields that beat the current national average by considerable margins and regularly place among the top rates for online banks nationwide.

Ally Bank CDs are FDIC insured up to $250,000 per depositor or $500,000 for joint accounts.

Ally Bank CD Rates

Term	APY
3 months	0.20%
6 months	0.25%
9 months	0.30%
12 months	0.55%
18 months	0.60%
3 years	0.65%
5 years	0.80%

To give the yields above some context, the current national average for 12 month CDs and 5 year CDs sits at just 0.15% and 0.28% APY, respectively, according to the most recent FDIC data.

Ally Ten Day Best Rate Guarantee

All of Ally Bank’s CDs come with a “ten day best rate guarantee.” This means that if you fund your account within 10 days of opening it and rates go up during this time, you will get Ally’s best rate for that term and your balance tier during that time. This also applies with CD renewals.

Interest is compounded daily which gives your overall APY (annual percentage yield) a boost over bank deposits that compound less frequently like monthly or quarterly.

Tiered rates by deposit amount do exist in more favorable savings rate environments; however, Ally Bank CDs pay the same APY for each term regardless of your deposit amount currently.

Early Withdrawal Penalties

Early withdrawal penalties at Ally Bank vary by CD term. They are as follows:

CD terms of 24 months or less will incur an early withdrawal penalty of 60 days’ interest.
CD terms of 25 – 36 months will incur an early withdrawal penalty of 90 days’ interest.
CD terms of 37 – 48 months will incur an early withdrawal penalty of 120 days’ interest.
CD terms of 48 months or longer will incur an early withdrawal penalty of 150 days’ interest.

Grace Period

Ally Bank has a standard grace period of 10 days where you can withdraw, add or transfer funds without incurring a fee. If nothing is done during this period, the CD will renew under the same terms at the current APY.

Ally Bank Loyalty Rewards for CD Account Holders

Ally Bank has a little-known loyalty program for those that continue to open and/or renew certificates of deposit with them. Currently, they are giving a 0.05% APY bump when you renew any CD with them. Be sure to check back 30 days before your CD matures to see what the reward is at that time.

Ally Bank “Raise Your Rate CD” Rates + Details

The Raise Your Rate CD offered by Ally Bank is going to be best suited for a climbing interest rate environment. Given the fact that CD rates are generally fixed throughout their duration, an opportunity to give your CD rate a bump when interest rates are on the rise, can be a huge benefit. And one that many other banks do not offer.

Ally Raise Your Rate CDs

Term	APY
2 year	0.55%
4 year	0.55%

The 2 year Raise Your Rate CD will give you the opportunity to increase your rate once over the life of the deposit.

The 4 year Raise Your Rate CD will give you the opportunity to increase your rate twice over the life of the deposit.

Ally Bank “No Penalty CD” Rate + Details

Withdraw any amount fee-free after 6 days of funding the account.

The Ally Bank No Penalty CD comes with only one term at the moment. The term is 11 months. You can withdraw any or all of your money from this deposit at any time after six days from funding the account.

Ally Bank No Penalty CD Rate

Term	APY
11 months	0.50%

As with Ally Bank’s other certificate of deposit products this APY is the same regardless of your deposit amount. In the past Ally Bank has rewarded larger deposits with higher yields; however, rates today are the same across the board for all amounts.

Final Thoughts

Ally Bank keeps their CDs simple and rewarding with no monthly maintenance fees, no opening deposit requirements and even the opportunity to open a “no penalty CD” with fee-free access to your deposited funds.

The APYs on their IRA CDs and regular CDs beat the current national average(s) handily, but pay the same yields on all terms regardless of deposit amount. There are also no differences in rates whether the CD is opened in an IRA or not.

Ally Bank’s digital interface – both online and through their IOS and android apps – are very intuitive and allow for easy deposits and account monitoring as well.

Capital One MONEY Teen Checking Account Review

Lauren Graves
March 30, 2021

The Capital One MONEY Teen Checking Account may be a great solution to teaching your teenager to become financially independent. Named one of 2020’s best checking accounts by GOBanking Rates, this fee-free, interest-bearing checking account helps teens learn how to spend wisely and save money for long-term financial goals.

Hunting for the perfect checking account for your teen? In this article, we’ll cover everything from fees and disclosures to how this kids’ checking account by Capital One stacks up against the competition.

Who is it For?

Average age: 13 to 17.

Good candidate: Tech-savvy teens with some experience managing their own money.

Kids eight years old and older are eligible to have this account, but it really is meant more for teens. The platform and practices are meant to mirror those of a standard checking account for adults, so this is best for older kids and teens who know their way around an app and have some degree of understanding about responsible money management.

Once a user turns 18, they can transfer their money to a 360 Checking Account. They may do this on their own without making their parent(s) a joint account owner. Alternatively, they can keep their MONEY account when they turn 18 and enjoy higher transaction limits.

A MONEY debit card by Capital One is issued in the teen account holder’s name and can be used anywhere Mastercard is accepted (with a few exceptions for safety reasons, outlined in “Is It Safe” section below.)

Noteworthy Features and Benefits

Fees: No monthly service fees or minimum monthly balance requirements; no ATM fees at over 70,000 in-network locations*; no fee for debit cards; no charge for incoming domestic or international wire transfers.

The Capital One MONEY Teen Checking Account puts teens in control but gives parents the final say. In other words, teens can have as much independence over their money and account as their parents deem appropriate.

This checking account currently earns an APY of 0.10%, compounded and credited monthly. This is a variable rate subject to change at any time. There is no minimum balance required to continue earning this interest rate and all interest accrued is automatically deposited into the account.

Parental Features and Benefits

When a parent and teen open a Capital One MONEY Teen Checking Account, they become joint account owners with the parent as the primary account holder. Parents can decide what permissions to set for their kids’ spending and can opt-in to receive alerts and push notifications about their activity.

With a MONEY checking account, parents are able to monitor their teens’ activity and intervene as they fit. This may mean locking their child’s card, setting withdrawal and purchase restrictions, or removing money from their account. A parent may decide to restrict their child’s spending at a certain retailer or location as well.

Parents can also encourage positive spending/saving behavior in their children by setting up automatic savings plans themselves and rewarding their children for reaching savings goals. They will be prompted with this choice, which they can either accept or decline and adjust as needed, through the app as soon as their child marks a goal as complete.

Parents and their kids have separate logins when using the app or online banking platform. Parents can see everything that their teens can see including account balances, savings goals, and spend activity from their screen and can make changes immediately from the app.

Parents can easily transfer money into their teen’s account from their own side of the MONEY account (more on how to fund this later). These can be one-time or recurring transfers for allowances and the like. Funding goes directly from a parent’s account of choice into their teen’s MONEY checking account. Unlike some kids’ debit products you’ll see, there is not a separate parent funding account from which money must be transferred.

Kids Features and Benefits

Teens with this account are encouraged to save with a competitive interest rate and optional, parent-activated account bonuses for reaching savings goals. They can set savings goals for themselves and divide their money into categories based on what is spendable and what is going to go into savings. Many financial literacy resources are available at no cost to users.

Teens can check their balance, see their transactions, set savings goals, and deposit money via direct deposit or check conveniently from the Capital One app. Besides having more alerts and the option of setting savings goals, the teen version of this app closely resembles many user-friendly checking account apps.

This is an online-only account and users never have to visit branches to manage their account if they don’t want to. This also means that the account is paperless and teens will receive electronic statements of their activity rather than paper statements and will not be given paper checks.

Teens can use their debit cards to make purchases at most retailers and online, and they can make withdrawals with their card for free at more than 70,000 AllPoint and Capital One ATMs.

Because parents and teens have their own accounts, teens can set their own username and password to access their account and PIN for using their debit card. This is a great way for teens to feel accountable and empowered with their accounts.

Overdrafting is not permitted with this debit card, so there is no fear of incurring fees for charging more than an account can handle.

*If this card is used at an out-of-network ATM, the account holder may be charged a third-party fee but will be reimbursed for withdrawals of this kind up to $15 per statement period.

Capital One MONEY Teen Checking Account Fees and Costs

Unless you request special services or extras, this really is a fee-free checking account. Other than a $25 expedited card delivery fee, a $5 statement fee for each paper statement you request, and a $10 fee for every Cashier’s check you purchase, this account does not cost anything to open, use, and keep.

Because this is a checking account and not a subscription-based product like Greenlight or FamZoo, there are no costs associated with keeping your account and accessing all of its features.

Capital One MONEY Teen Checking vs Competitors

One of the primary benefits of the Capital One MONEY Teen Checking Account over competitors—either checking accounts or prepaid cards—is that this account earns interest. Though it doesn’t offer the high-yields seen in the best checking and savings accounts on the market, this product is competitive compared to many other checking accounts and allows teens to learn about interest and how to maximize their earning potential.

Some other kids’ banking products do let users earn interest on savings, but in most cases, parents pay this interest and set the rates. In the case of this Capital One product, interest is paid by Capital One, a bank that tends to be fairly competitive with its rates.

Another benefit of this checking account is that it is pretty hands-off for the parents. You can choose to monitor your kids’ spending as much as you’d like, but you won’t be prompted to add more money if your child’s account balance gets low (because there’s no account minimum), approve their purchases, or otherwise micromanage their experiences.

Potential Drawbacks

There are few things not to like about this debit card and checking account, but some of the limitations could potentially be problematic. For example, all withdrawals and purchases are capped at $500 per day for users under the age of 18 years old. This includes ATM withdrawals as well. If for some reason your teen needs to charge an amount greater than this, you’ll run into problems and will need to contact Capital One for help.

Some people may also be disappointed by that 0.10% APY. It won’t be easy to find another checking account for teens with a higher interest rate, but this could still be a deal-breaker.

There is also no way to invest or donate with this particular checking account. This is something you’ll see offered by a lot of prepaid cards and debit cards marketed toward younger kids, but Capital One limits what users can do with their money with the MONEY checking account. It is more like a regular checking account in this respect.

Customer Sentiment

There is little in the way of customer reviews for the MONEY checking account online, but there is plenty of data on how people feel about banking with Capital One.

Reviews for Capital One are predominantly positive. This bank is known for offering great customer service and for being transparent with users about fees and restrictions. Overall, people that bank with Capital One are satisfied with the rates, support, and product they receive.

This is a huge, well-established bank with millions of users, so finding in-network ATMs and getting support is relatively easy for most.

To contact customer support, call 1-888-810-4013, tweet @AskCapitalOne, or reach out by mail at the following address:

Checking Accounts, Savings, Money Market and CD Accounts

Capital One Bank

P.O. Box 150

St Cloud, MN 56302-0150

There is no dedicated customer support line for MONEY Checking Account users, but you can send secure messages to an automated system at any time with non-urgent questions.

All MONEY checking account mobile banking is done through the Capital One app, which is one of the highest-rated banking apps available. It has 4.8 stars in the App Store and 4.7 stars on Google Play. You can also sign in to your account online to see your transactions and manage your account.

Is it Safe?

Like any other checking account with an accredited financial institution, this checking account is FDIC-insured up to the federally allowed limit of $250,000.

Capital One also prohibits the use of this card at establishments that are potentially unsafe to your child. These include:

Places that serve/sell alcohol like bars, nightclubs, and liquor stores
Massage parlors
Retailers that sell prescription drugs
Car rentals

As mentioned, parents can further restrict their kids’ spending by adding more establishments to this list of restricted retailers or by lowering their daily spend/withdrawal limit.

All charges made with a card that would lead to overdrafting are declined automatically. Both parents and teens will be notified if this happens.

How to Sign Up

Parents do not need to be Capital One customers to open a MONEY account for their teen. They can link nearly any deposit account except for money market accounts, savings accounts, and investment accounts.

Conveniently, everything can be done online when you sign up for a MONEY Teen Checking Account, but you can visit a Capital One branch in-person if you prefer. There is no minimum opening deposit requirement and the account can be funded in a number of ways. These include linking a Capital One or external checking account, making an ACH transfer via direct deposit, and funding with a card.

If you have multiple teens that you’d like to open accounts for, you will need to do so separately. This isn’t like some other kids’ debit card products, which give parents up to four or five debit cards per household and keep them all under one roof.

Final Thoughts

Just as Capital One has proven over the years to be a pretty solid bank and credit card issuer, the checking account for teens offered by this institution is tough to beat as well. This checking account stands out from its competitors because it pays interest, doesn’t charge any fees, and offers kids a safe, user-friendly banking account that’s as close to the “real thing” as you can get. It’s clear why personal finance experts recommend this checking account to parents for their teens.

YouHodler Review: Earn 4.80% APY on BTC + Up to 12.7% on Other Currencies

Kevin O'Brien
March 26, 2021

The decentralized finance industry continues to gain momentum as more investors realize its potential. Innovations inside the DeFi ecosystem continue to break down walls and barriers across economic realms.

However, one of the trickier aspects of DeFi and the wider crypto ecosystem is buying and holding assets to participate in these industries through immense market fluctuations. It can be very tough to HODL as an investor watches how quickly the price of a particular coin can move in just a few seconds.

Platforms like YouHodler were created to help solve issues like these. Users can hold crypto coins while leveraging them for loans, mirroring the lending and borrowing business model practiced across many centuries by traditional banks.

What Is YouHodler?

Based in Switzerland, YouHodler functions as a crypto-backed loan service provider. Users on the platform can instantly borrow fiat based on the value of their underlying crypto asset holdings, or convert their virtual currencies to other crypto and fiat.

Alternatively, users can hold digital currency on a YouHodler savings account and withdraw any fiat money on the platform to a personal bank account or credit card. However, the platform does have some restrictions and is not accessible to residents of the USA, China, North Korea, Sudan, Syria, Palestine, Iran, Cuba, Crimea, Pakistan, Iraq, and Bangladesh, at the time of writing.

The platform was founded in 2018 and is insured for up to $150 million via a customized crime insurance program led by Arch UK Lloyds of London. Their platform is also licensed by the European Union Financial Commission. Founder Ilya Volkov remains an active member of blockchain and crypto-related organizations and holds 15 years experience in commercial finance and trading. CTO Renat Gafarov has worked on hundreds of unique smart contracts and has spent years crafting blockchain integration solutions.

YouHodler Services

YouHodler offers users a variety of services, including:

Crypto Savings Account: Those on YouHodler can earn up to 12% APR though an interest-earning crypto savings account. After deposit, weekly interest payments can be accrued in Bitcoin or other cryptos like stablecoins. An intuitive dashboard makes it easy to monitor interest. A unique feature of YouHodler is there is no deposit threshold to benefit from the best interest rates.

Crypto-Backed Loans: Users can also secure a fiat currency loan using crypto as collateral. These types of loans are best for those interested in getting fiat without having to sell digital currency. Since these loans are over-collateralized to account for volatility, users will have to lock up digital currency that’s more valuable than what they are trying to borrow. However, this is a typical practice in the crypto-backed loan world. Loans on the platform can be as small as $100 and users can select 30, 60, or 180 day terms. Unlike traditional loans, there are no eligibility criteria like credit scores of financial checks to secure a loan. A user just needs to want to borrow at least $100 from YouHodler to receive a loan and have the right amount of collateral.

Exchange: The YouHodler exchange makes it simple for users to switch between platformed-supported cryptocurrencies and fiat. On-platform tools show the estimated fee, arrival time, and exchange rate. The idea is to eschew a complicated trading interface and give users the feeling of an ‘instant’ swap.

Multi-HODL: These tools allow YouHodler users to take advantage of market volatility. The multi-HODL feature lets users take a portion of their funds and then speculate on the price of one of their currencies. Leverage comes from borrowing extra funds to amplify profit or losses while maintaining the ability to set stop-losses and take-profit levels. Users are also still able to earn interest. Users can select the up option to use crypto as collateral with USD as the borrowed currency, working best if a user thinks the value of crypto will grow. If they believe the opposite, the down option uses USD to borrow crypto assets.

Turbocharge: Turbocharge lets a user take an entire deposit to borrow fiat and then purchase more cryptocurrency, functioning as a ‘synthetic’ margin trade. In contrast to multi-HODL, turbocharge is only used when a user believes the price of their asset will go up.

Mobile Application: All of the platform’s core services are able to be accessed in a mobile application that can be found on either iOS or the Google Play store.

Speed, Security, Insurance

The YouHodler website spells out a variety of security features. The team says funds are stored in a mixture of hot and cold wallets and the platform incorporates Ledger’s technology to offer advanced custody options.

Funds are also protected as YouHodler benefits from Ledger Vault’s pooled crypto-asset crime insurance program with up to $150 million in coverage. Led by the Arch UK Lloyds of London syndicate, the insurance covers employee theft and outside robbery of private keys and the master seed.

YouHolder users should understand, according to the team, that Ledger will never hold YouHodler’s keys or managers even though the platforms are linked.

A backup mechanism means the YouHodler team can retrieve lost funds without having to turn to Ledger. Vault access is also distributed across different managers who have varying access rights, yet are still required to adhere to mandatory multi-signature principals.

YouHodler also gives users the opportunity to secure their assets with 3FA protection. Balances of over $10,000 (or the equivalent in crypto and fiat) can ask to disable all withdrawal options. YouHodler would then only allow withdrawals by the request of the account owner after verifying their identity again.

Deals with Elliptic and CipherTrace help analyze all transactions to protect against fraud schemes, terrorist financing, money laundering, and sanctions evasion. Of course, users can also take advantage of 2FA if they have less than $10,000 and use a strong password to keep their account safe.

The platform also writes about various procedures and laws they are bound by to enhance security. For example, deals are structured by contracts that fall under EU law, meaning the platform is “bound by law to return your cryptoassets.”

Additionally, YouHodler’s status as a Blockchain Association member means users have a way to dispute resolutions by a third party and receive outside assistance. YouHodler writes this security essentially functions as a form of crypto insurance for clients since resolutions from the Association are quick and unbiased. The team says they have not heard of any instances where a YouHodler client complained to the Association.

Fees and Access to Funds

Since YouHodler deals in crypto loans, the fee structure varies based on a couple of factors. As of March 2021, the fee breakdown is:

30-day loan: 3% loan fee, 90% LTV, -5% price down limit (PDL)

60-day loan: 5% loan fee, 70% LTV, -25% PDL

120-day loan: 9% loan fee, 50% LTV, -40% PDL

A user can also customize loans upon request and just need to pay the loan fee to reopen another loan. Those with a loan can also activate Turbocharger where a flurry of loans can be set in motion after the app automatically executes them.

If a user does not pay their loan on time, YouHodler can extend for up to 14 days before closing. They will also charge an extension fee of 1% of the loan overdraft amount per day and deduct the ensuing cost from the loan collateral.

People interested in withdrawing their money can take advantage of a bank wire or by using a Visa or Mastercard. Fund access will depend on the individual bank’s policies.

How to Set Up a YouHodler Account

Setting up a YouHodler account is a pretty simple process.

Visit the YouHodler Website: A trip to the website presents prospective users with the option to create an account either with the signup link or the ‘Get Loan’ link.
Fill Out Required Information: Users are asked to input an email address and then perform a couple KYC verification steps. Moving through verification is smooth as users just have to input a certified IDs and take a selfie to confirm identity.
Set Up 2FA: While implementing 2FA is optional, YouHodler recommends it to make the experience safer.

Now users can begin the process of starting a crypto loan, earning interest, and withdrawing their money!

YouHodler Crypto Savings Account Features

The platform lets users earn up to 12% a year by depositing crypto and then transferring them to a savings account. Eligible coins include BTC, ETH, PAXG, HUSD, DAI, TUSD, PAX, USDC, and USDT.

Funds are paid out based on weekly compound interest in both stablecoins and fiat. Savings funds can also be used as collateral for lending products. The compound interest is calculated roughly every six hours.

However, savings account holders should note that releasing funds before the end of a weekly period means the accrued interest from the week is lost. Those who deposit additional crypto will receive the interest in just the week following. However, assets can be removed at any time.

As mentioned earlier, users can harness their crypto savings accounts for the Turbocharge functionality. The platform will automatically use collateral for the loans. Turbocharge is lucrative because there are no extra fees beyond the first loan and the loan interest rate is also lessened.

YouHodler Crypto-Backed Loan Account Features

YouHolder users can use fourteen different cryptos as collateral for a loan. Getting a loan usually takes seconds and the platform comes equipped with a variety of features to manage the loan and respond to market changes.

For example, YouHodler offers a few ways to exit a loan aside from just paying it off. Closing a loan without repaying it fully means the loan will be fulfilled using a holder’s collateral. ANy remaining crypto will then be automatically sent to the user.

There’s also an option to reopen a loan with the same terms if the current term is close to maturity. Extending the price down limit is also an option if a user would like to add extra collateral.

Finally, users with a top rate LTC of 90% can just receive a loan and walk away, with no consequences, with 85% of the value. The ‘walk away’ feature helps YouHodler users exchange crypto for cash in a free manner.

YouHodler also understands market forces dictate how a loan holder might want to respond. As a result, each loan comes with a ‘Price Down Limit’ to ensure the loan amount will not change. YouHodler then reserves the right to close the loan and sell collateral if the price of a crypto backing a loan drops behind the PDL.

Users are notified if the price dips below ⅔ of the PDL. This is a coursey service and does not cost any fees.

Loan holders can also set a take profit price on a loan and watch as the platform automatically sells off collateral to pay the loan – depositing the extra funds in a user wallet. Setting the close price is done when a user originally requests a loan.

YouHodler Customer Sentiment

The platform has pretty good customer sentiment at the time of writing, as YouHodler looks focused on keeping a strong reputation as the DeFi world keeps expanding. Users have lauded the platform for its live chat, email, and phone services and the good response times on each of the mediums.

YouHodler’s iOS app has 4.8/5 stars at the time of writing. Reviewers appreciate how easy to use the platform is and the responsiveness of the many features on mobile. Some users even claim it’s easier to use than other platforms like Kraken.

On the iOS side, the majority of the negative reviews revolve around the fact that U.S.-located people can’t use YouHodler. Some complain they started to input personal information before realizing it would not allow U.S. customers and question what the platform is then doing with the information.

However, the YouHodler team does take time to respond to these kinds of reviews and remind users they are limited by legal restrictions to service U.S. customers. Team members do note they are working on this front and will inform if the situation changes. YouHodler’s website also looks at a visitor’s IP and will notify a person if they try to register if they are detected to be accessing the website from the USA.

The platform has 4.1 out of 5 stars on the Google Play store. Positive reviews note the sleekness of the platform and its user friendly nature. Even though some note the fee structure is high, they applaud YouHodler for being honest about fees up front and for providing options that can help crypto holders ‘get the most out of their money.’

Negative reviews focus on a few key points. Some users indicate issues with the app crashing upon opening and then having to try and reinstall, or just turning to the web browser for a smoother experience. Sometimes these issues can be as a result of a specific update or modification and can be resolved in future editions.

The YouHoder team does look to be responding to these types of issues with a request to reach out to the support team if needed. Some negative reviewers who write about application bugs do note the customer support has been prompt with getting back to users and addressing issues.

Many other negative reviews centralize issues with the reCaptcha verification service and how it does not verify properly to let a user register. YouHodler looks to be responsive with these types of requests and notes that reCaptcha is a ‘black box service,’ writing that as a result they might not be able to actually ascertain why there is an issue.

Overall, customer sentiment looks to be strong and there are many positive reviews that highlight the platform’s usefulness, simplicity, sleekness, and transparency.

Final Thoughts

YouHodler is a unique platform that offers a lot of financial options. As the DeFi world keeps expanding and features more innovation, users are undoubtedly looking for ways to profit and make money with their funds in safe ways. Many are wary of options like yield farming and look for ‘safer’ alternatives like crypto savings accounts and similar financial tools.

YouHodler offers new and experienced crypto users opportunities to make strong returns or to just leverage digital assets to make more money. The platform is transparent and honest about fees and the ability to quickly set up accounts is another plus.

The lack of support for U.S. customers is a big drawback, but the myriad of laws in the nation do not make it surprising that the platform can’t service these types of customers. Odds are good they will figure out a way, like many other crypto entities do, to function in the U.S.
Security is always a big issue with crypto platforms and YouHodler’s vast range of options should encourage investors. The ability to secure larger accounts with extra measures like 3FA is not often seen with other protocols, while the infrastructure messaging with the reputable and secure Ledger vault is another bonus.

Overall, YouHolder is a secure and effective platform for those interested in crypto loans and savings accounts.

Comenity Direct High Yield Savings – 0.55% APY + 0.90% APY CDs

Lauren Graves
March 19, 2021

[Update March 2021: Comenity Direct finally lowered the rate on their variable rate high yield savings account by 0.05% to the current 0.55% APY. They also raised the rate on their 1 year CD from 0.60% APY to the current 0.63% APY.

Update January 2021: The APY (annual percentage yield) on Comenity Direct’s variable rate high yield savings account and all of their fixed rate CDs remain unchanged to start the new year. Their last rate drop was in September of last year.]

You may have heard of Comenity – the global credit card services provider with a product range featuring more than 145 retail-branded credit cards – but did you know they do FDIC-insured deposit accounts as well?

This corporation’s online banking services sector, Comenity Direct, offers online CDs and a high yield savings account featuring APYs well above the national average.

Comenity Direct scores high marks across many review platforms for its high-yield savings and certificate of deposit accounts – which require fairly low opening deposits, incur minimal fees and boast big rates.

That said, Comenity Direct isn’t perfect – customer experiences are mixed and other banks are going to have more options for accessing cash – but if high savings rates are what you’re after, the pros seem to outweigh the cons in a significant way.

Comenity Direct High Yield Savings Account APY + Details

Although FDIC insurance only covers you up to $250k, Comenity Direct’s high yield savings accounts earn interest up to $10 million.

Balance	APY
$100	0.55%

Recent Rate Drops on Comenity Direct’s High-Yield savings account:

dropped from 1.70% to 1.55% APY on May 18
and then from 1.55% APY to 1.45% on May 21,
and then again from 1.45% to 1.35% APY on May 29th,
and then from 1.35% to 1.10% APY on July 1, 2020
then again from 1.10 to 1.00% APY around July 23, 2020
dropped for the first time in August on the 14th to 0.80% APY (down from 1.00% APY)
dropped in September, 2020 to 0.60% APY
dropped in March 2021 to 0.55% APY

The national average, for context, has been hovering around 0.07% for several weeks and doesn’t seem likely to go up any time soon. That said, remember that these online savings account rates are variable and can change at any time without notice. Interest on the Comenity Direct High Yield Savings account is compounded daily and credited monthly back to the account.

For such a strong rate of return, you might assume that these accounts require a high minimum opening deposit and balance, but this is not the case. As with many online savings accounts the minimum balance required to open and earn interest is quite low – at just $100. You’ll want to note that you won’t earn interest if your balance drops below $100 and if it happens too frequently Comenity Direct may close your account.

There are few fees you should be aware of with the Comenity Direct High Yield Savings account:

$25 per outgoing wire transfer,
$15 per paper check, and
$5 per paper statement (in an effort to encourage fully paperless billing and banking).

As for monthly maintenance, incoming wire transfers, ACH transfers, and online statements, these are all free and there is, again, no low balance fee. In compliance with federal regulation D, you can make up to 6 transactions a month for free. An excessive withdrawal fee is not listed, so Comenity Direct may just prohibit transactions over this limit from going through.

To add funds when you open an account, link an external bank account and make a transfer or set up direct deposit. You cannot deposit cash.

Comenity Direct CD Rates + Account Details

Although FDIC insurance only covers you up to $250k, Comenity Direct’s certificates of deposit earn interest up to $10 million.

Like Comenity Direct’s savings account, their CD accounts are also miles ahead of the national average in terms of APY. You’ll also notice that rates still increase with the terms, which can’t be said for many institutions’ deposit products today.

CD Term	APY
1 year	0.63%
2 year	0.75%
3 year	0.85%
4 year	0.85%
5 year	0.90%

To give these rates some context, the current national average for a 1 year CD is just 0.22% APY currently.

You can still lock in 12 month CDs above 0.90% APY through some credit unions but the pickings are slim.

These are all standard certificates. There aren’t any special, jumbo, or step-up CDs in their product suite at this time.

With a minimum deposit of $1,500, you can open a Comenity Direct certificate of deposit account under any term. The same fees apply for certificate accounts as with the savings account mentioned above with the only addition being early withdrawal fees.

Early Withdrawal Penalties

Early withdrawal policies with this bank are straightforward.

If your term is between 12 months and 3 years in length, you’ll owe 180 days’ interest for an early withdrawal.
If it’s greater than or equal to 4 years, you’ll owe 365 days’ interest.

Grace Period

The grace period is 10 days after maturity. You can let your account automatically renew after this period expires or cash out the full balance before the time is up. In other words, when your certificate matures, you’ll have 10 days to either add funds or withdraw funds and close the account.

Interest and Dividends

Interest compounds daily and is credited to your account monthly.

Dividends can be paid out via ACH transfer to a linked external account or to your Comenity Direct High-Yield savings account if you call customer service to make this request at least 3 days before the interest is applied. But unless you put in this request, your account will default to depositing credited interest back into the certificate.

Banking Reviews and Customer Sentiment

If you were to ask 10 different Comenity Direct customers how satisfied they were with their overall banking experience, you’d likely get 10 very different answers. This range is reflected in the thousands of online ratings left for the bank.

If you go to DepositAccounts, for example, you’ll find a dead-average 2.5-star rating out of 22 reviews. If you go instead to ConsumerAffairs, you’ll see a single star. And over on WalletHub, 16,846 people have given the bank an average score of 3.8 stars. Keep in mind the sheer number of reviews on WalletHub versus the others likely make it the most accurate reading.

Taking customer feedback into account, Comenity Bank scores a little better than what’s normal for a respectable and trustworthy bank or credit union. And because Comenity Direct is an offshoot of Comenity Bank and offers only deposit and savings accounts through this company, these reviews are largely for Comenity Direct accounts.

Understand that many banks and credit unions are receiving harsh feedback from their users at this time amidst the panic of COVID-19 and all of the financial difficulty that has come with it.

The Comenity Direct app has just 2.5 stars on Google Play but 4.4 stars on the App Store. Do with this discrepancy what you will, but it seems like the mobile app performs better on Apple devices. Remember, you can also do your banking online if their apps are underperforming.

The Comenity Direct Customer Care Center is available to take your call from 7 AM to 11 PM (CT) Monday through Friday and from 9 AM to 5 PM on weekends and holidays. The number for this is 1-(833)-755-4354. You can also reach help online through the web banking platform. Unfortunately, there is no live chat feature at this time and no option for those that prefer sending an email or letter.

There are no Comenity or Comenity Direct branches or ATMs, so ATM access is a no-go. But since there are also no ATM or debit cards offered with these deposit accounts, this shouldn’t be too surprising. This bank does not allow cash deposits, but you’ll be able to make and receive unlimited ACH transfers.

Final Thoughts

All in all, if you’re after respectable rates, there are many reasons to sign up for a Comenity Direct high yield savings or deposit account. What this online-only institution lacks in physical accessibility it makes up for in competitive rates. So as long as you are on board with the basic concept of online-only banking and see at-your-fingertips banking as a benefit of going digital rather than a hindrance, Comenity Direct is a strong choice.

Outside of attractive rates, Comenity Direct doesn’t charge many fees on its highly rewarding savings and deposit accounts. The accounts also compound interest daily and allow for unlimited ACH transfers.

Crypto.com – Earn up to 12% on Stablecoins and 6.5% on Crypto!

Jeremy Wagner
March 18, 2021

Crypto.com was established in 2016 with a mission to accelerate the world’s transition to cryptocurrency. Crypto.com believes it is your basic human right to control your money, data and identity.

Crypto.com continues to live up to their mission as they have over 10 million users globally and a staff of 900 employees worldwide.

Since they are a blockchain-based financial services company, saving your crypto with them to earn interest and spending via a visa card is an important part to their business model.

Crypto.com Features and Benefits

As a blockchain-based financial services firm, Crypto.com is a one stop shop for much of your crypto based needs. They have built their services into a nice app so everything is right at your fingertips.

They also allow you to transfer your crypto between Crypto.com app users free of charge.

However, Crypto.com is best known for their broad range of crypto they service and generous interest rates and crypto rewards programs.

Supported Currencies and Yield

Supported Currencies	U.S. – 50+ Worldwide – 90+
Yield on Crypto	6.5%
Yield on Stablecoins	12.0%

Crytpo.com is regularly adding new supported currencies. Check back for updates as we update this post regularly.

Crypto.com App

The Crypto.com app is one of the fastest growing crypto apps on the market with over 10 million users buying and selling over 100 cryptocurrencies at true cost.

When you log into the app (download here), you’ll find current balances of:

your fiat wallet,
crypto wallet,
crypto EARN deposits and
Crypto.com Visa card balance.

The fiat wallet contains the money you have sent to Crypto.com, but have yet to exchange for crypto or to top up the visa card.

The crypto wallet holds the keys to the cryptocurrencies you have purchased with your fiat wallet.

Crypto Earn is where you deposit your crypto to earn interest.

Lastly, the Crypto.com visa card is a debit card that allows you to earn additional crypto rewards such as crypto cash back or crypto reimbursements for services like Netflix and Spotify (among others).

Moving Funds from your Bank to Crypto.com Fiat Wallet

As a blockchain-based financial services firm, it starts with buying crypto. The process to buying crypto includes transferring your fiat currency (ie-USD, EUR, CAD, AUD, etc) to a crypto dealer like Crypto.com.

Depending on your jurisdiction, the method to transfer your fiat currency to Crypto.com may differ. I set up bill pay for Crypto.com in the same way I would pay my electric bill. After confirming a couple of small transactions, the connection between my home bank and Crypto.com is established.

Now, initiate a transfer of your US dollars, Euros, Australian dollars, etc to your Crypto.com wallet. When the funds arrive at Crypto.com, they will deposit them into your fiat digital wallet.

There are two things you can do with the money in the fiat wallet. You can use those funds to buy crypto or you can top up your Crypto.com visa card.

Buying Crypto with your Fiat Wallet

One of the biggest attractions to Crypto.com is their extremely large range of cryptocurrencies you can purchase. At the time of this writing, you can buy more than 100 different cryptocurrencies with them.

When you explore, analyze and research a cryptocurrency project via the app, if it can be purchased with Crypto.com you will find a large BUY button on the page. You can buy with your fiat wallet funds or sell another cryptocurrency to buy the new one.

Once you have acquired those cryptocurrencies, the next step is to decide where you want to store them. You can pull the crypto offline into your own cold storage or you can keep the private keys with Crypto.com. There are advantages to either situation so it depends on what your goals are with the crypto.

Individuals with the goal of a long-term large investment in crypto, might consider the cold storage route.

If you are ok with exchanges like Crypto.com holding your private keys, then they offer handsome interest rates for lending your crypto out.

How to Earn Interest with Crypto.com

Their interest-bearing program is called “Crypto Earn” and it is VERY easy to get started.

When you click on the “Earn” section within the app you will find options to add deposits or withdraw from the EARN program.

If you want to deposit your Bitcoin or favorite stablecoin to earn interest, simply add it to the program by pressing the plus “+” sign. Then, you will be asked which cryptocurrency you want to deposit. Crypto.com’s Earn program is one of the most diverse interest-bearing programs out there as you can deposit 35 different cryptocurrencies to earn interest.

Currently, the stablecoins offer the largest interest rate between 6-14% annually. With Bitcoin, you can earn between 1.5% and 8.5% annual.

Once you select the cryptocurrency, you’ll be prompted to enter how much crypto you wish to deposit. Essentially, all you are doing is moving it from your crypto wallet over to the Earn program.

The next prompt is selecting a term of deposit. Crypto.com offers three different terms.

Flexible Interest Rates
1 Month Term Deposit
3 Month Term Deposit

Crypto.com Flexible Interest Rate Deposits

These types of deposits are just as they sound, flexible. As a result of this flexibility, these deposits will be earning the lowest interest rates. You can make the deposit today and decide to withdraw the deposit tomorrow and earn one day’s worth of interest in the process. Or, you can keep the deposit as flexible for an indefinite period of time.

Flexible interest rate deposits are desired if you don’t want your crypto needlessly tied up for too long.

For example, let’s assume you want to buy some bitcoin but you are waiting for the price to drop. You can use your fiat wallet to buy some Dai (a stablecoin), then place Dai into a flexible contract earning 6%.

That way, when the price of bitcoin drops to a level where you want to buy, you can withdraw your Dai immediately from Earn and turn around to buy bitcoin with it. In the meantime, you would have earned a little Dai interest deposited into your crypto wallet.

Crypto.com 1 Month Term Deposit

The 1 Month Term means you are locking up your deposit for 30 days. Once you agree to this term, you will not be able to withdraw the deposit until the term expires.

This option is used when an investor does not have a need for the cryptocurrency for at least a month. Investors will also use this option to help ladder into various expiration dates too.

The interest rate on a 1 month term is better than flexible. As an example, Dai deposited into a 1 month term would earn 8% versus the flexible 6%.

Crypto.com 3 Month Term Deposit

The 3 Month Term brings the largest interest rate, but you will have to lock up your crypto for 90 days. If your time horizon is long term and if you don’t plan on needing to sell the crypto beforehand, then this option is great.

The interest rate is significantly higher than the flexible term so you get to earn a high rate for a buy and hold strategy.

As an example, an investor that deposits Dai into a 3 month term would see 10% interest annually. Likewise, the 3 month bitcoin rates are near 4.5%.

You can see what the current rates are for your crypto and term.

Fortunately, the app will display the interest rate for each of the terms so it is clear ahead of time what your rate will be. The longer the term, the greater the interest rate.

Generally speaking, the minimum deposit to a contract is around the equivalent of $250. Since the value of cryptocurrencies can fluctuate, the minimum US dollar equivalent will fluctuate as well.

Crypto.com Interest Payment Frequency

Interest within the Crypto.com Earn program is paid once per week. If you start the deposit on Wednesday, then you will receive interest on the next Wednesday.

When the interest is paid, it will get deposited as the same currency into your crypto wallet. For example, you deposit bitcoin into Earn, then you’ll receive interest paid in bitcoin that will appear in your crypto wallet. It is important to remember this is a simple interest calculation and not compound interest.

In a rising bull market, earning interest in a strengthening currency is a great thing. This means the value of your investment AND interest are increasing in value.

In a falling bear market, the opposite can happen where the interest you earn is worth less even though the interest rate remains constant.

Increase your Crypto.com Interest Rate Even More with Staking

Crypto.com pays a higher interest rate when you stake their token, CRO. Before explaining the benefits, let’s first dive into staking.

What is staking?

Staking is a “consensus” mechanism for how the blockchain is secured preventing users from printing extra coins they didn’t earn.

A huge benefit of blockchain is that it can be decentralized. That means everybody can access it but nobody controls it. Since there is not a central authority controlling it, there needs to be a way to ensure proper tracking. Otherwise, people would spend more coins than they earned undermining the entire system. Such a scenario would collapse the coin making it worthless.

When you stake Crypto.com’s native token, CRO, you are essentially putting it on deposit so that you can participate in the network’s validation of new blocks being created. There are rewards associated with newly created blocks and a portion of those rewards get passed along to you.

Therefore, you can simply park your cryptocurrencies into Crypto.com’s Earn program and earn a little interest. Or, you can juice up the interest rate by staking additional funds as CRO.

Earn up to 14% Annual Interest with the Highest Tier of Staking

There are essentially 3 different tiers of staking that affect the interest rate within the Crypto.com Earn program

0-49,999 CRO stake
50,000-499,999 CRO stake
500,000 or greater CRO stake

The greater the stake, the greater the interest rate. Let’s go through a couple examples.

A stake of 50,000 CRO (around $7,500-$15,000 depending on the exchange rate) will open up an increased interest rate for you within the Crypto.com Earn program.

For stablecoins, that is an increased interest rate of 2% across each of the contract terms. It varies for bitcoin, but could be as much as a 2% increase for the rate. As an example, a 3-month term deposit with a 50,000 CRO stake would yield 6.5% on the bitcoin deposit.

For a stake of 500,000 CRO (around $75,000 – $150,000) the rates move up even higher. A 3 month deposit of stablecoins into the Earn program will yield 14% and bitcoin’s interest rate is 8.5%.

Oh, by the way, when you stake CRO with Crypto.com, you will also earn 6% interest on the staked CRO.

Is Staking Safe?

Cryptocurrency staking is often a more profitable means to earn interest, but with some added risk.

First, Earn deposits are not backed by governments and they are not insured by FDIC and SIPC. Therefore, you won’t have the same level of protections like you would with a bank deposit.

Additionally, the valuation of the underlying cryptocurrency (CRO) could fall diminishing the value of the interest earned.

Also, a minimum 180 days staking period is required (6 months). You will earn interest on the CRO, but that CRO which you lock up is inaccessible for 6 months.

The inflexibility of tying up funds in CRO is a big potential risk. If the value of CRO diminishes, you would not be able to withdraw until the contracts are met.

Additional Ways to Receive Crypto with Crypto.com

Another interesting feature with Crypto.com is that you can utilize them with a visa debit card and earn cash back crypto.

For example, I can go to the store or a restaurant and pay with this card and the merchant will have no idea it was obtained via a blockchain-based financial firm.

In my case, the merchant will receive US dollars just like if I were paying with my other debit or credit card.

The big benefit of using the card is that cash back rewards are paid in crypto. Cash back rewards start at 1% of the purchase amount, but can range to a high of 8% depending on how much CRO you stake. Additionally, you have the opportunity to receive other staking benefits like Spotify, Netflix, and Amazon Prime membership reimbursements.

Crypto.com Rewards Visa Card

A second way to gain crypto via crypto.com’s financial services is to take advantage of their visa card.

You can grab the visa card and receive 1% cash back on all purchases.

Or, with your staking above, you can also obtain one of their visa cards.

For example, a 50,000 CRO stake not only provides a higher interest rate for your Earn, but also provides a higher cash back reward.

Let’s assume an investor stakes 50,000 CRO and grabs a Jade Green Visa card with Crypto.com. The investor could then earn up to 12% annual interest on stablecoins and up to 6.5% on bitcoin through the Earn program.

The investor would also earn 6% on the CRO staking (about 250 CRO per month).

Additionally, the card benefits include Spotify and Netflix membership reimbursement. If our investor has $20 of subscriptions in Spotify and Netflix, that means about 117 CRO monthly (at a 0.17 CROUSD exchange rate).

Lastly, if the investor spends about $500 per month on the card, then 3% rewards would add another 88 CRO.

Our investor would be hauling in about 455 monthly CRO as rewards for staking plus a higher interest rate in their Earn program. This does not include the interest earned on their stablecoins or bitcoin either!

The cross-over of staking to receive a higher interest rate, more rewards with the visa card, plus a broad range of cryptocurrencies to earn interest on explains why Crypto.com has been growing rapidly to more than 10 million users.

Next Steps

Visit Crypto.com to begin the process of creating and setting up your digital wallet – or – read our rundown of the top crypto savings accounts on the market in 2021.

Top 11 Crypto Savings Accounts [2021 Edition]

Jeremy Wagner
March 16, 2021

Earn between 3.20% and 12% APY on your crypto holdings.

Full disclosure: We may receive financial compensation when you click on links and are approved for products from our advertising partners. Opinions and product recommendations on APYGUY are those of our writers and have not been influenced, reviewed or approved by any advertiser. Learn more about how we make money.

If you’ve succumbed to the crypto craze and own some cryptocurrency yourself, then you may be interested in a crypto savings account to give these holdings an added boost.

These types of ‘savings accounts’ are relatively new, as with crypto itself, but the rate of return is eye-catching and certainly puts the best yields offered by FDIC-insured banks to shame.

That said, while these products can be exciting, they do come with underlying risks that typical savings accounts offered by banks or credit unions do not. So, if you’re considering investing in cryptocurrency just for the high yield savings products, you may want to conduct further research to see if these digital currencies are right for you.

However, if you already own cryptocurrency and want to couple this with fantastic yields, then continue reading our comprehensive guide of the top crypto-based savings accounts on the market in 2021.

BlockFi – Best Overall

Earn up to 8.6% on stablecoins and 6% on bitcoin with BlockFi!

BlockFi is a crypto custodian that was founded in 2017 and just landed $350 million in funding (March 2021) which pegged the company at a $3 billion valuation!

This platform has exploded in growth since their inception and currently offers retail and institutional-facing products.

On the retail side of its platform, people can use its mobile app to earn a yield on their crypto holdings (6% on Bitcoin, 8.6% on stablecoins). You can currently earn impressive yields on the following:

BTC,
ETH,
LTC,
PAXG
USDC,
USDT,
GUSD,
PAX

The BlockFi interest account features rates up to 8.6% on stablecoins and 6% on bitcoin. Sign up and download the app here.

The lowest APY BlockFi offers is just 3.0% for deposits of 2.5 BTC or more. The more Bitcoin you deposit, the less interest you earn with BlockFi. Other cryptocurrencies feature flat rates from 5.0% to 8.60% APY.

You can learn more about how BlockFi’s interest works here, but in a nutshell they generate interest by lending your assets to “trusted institutional and corporate borrowers.” They also claim to lend crypto on overcollateralized terms with an automated risk management system that monitors positions 24/7.

Celsius Network – Best for High Yield + Sign Up Bonuses

The Celsius Network offers noteworthy yields and even sign up bonuses, however, the very best rates can not be attained by U.S. residents.

Celsius has a loyalty rewards program that pays rewards in tiers with its own native currency (the CEL token). Those in the rewards program have access to Celsius’s highest rate of 18.55% however, the rewards program is not currently offered to U.S. residents. We will update this post when/if that changes.

APYs for U.S. residents range from 2.50% to 13.99% APY.

There are no minimum deposit requirements and interest payments are made weekly.

There’s currently a $40 bitcoin sign up bonus for new customers too! Download the app here for the bonus.

Here’s what to do once you download the app: Use the promo code WEB40 to get $40 in Bitcoin after transferring $200 or more in crypto to your Celsius wallet and holding it there for at least 30 days. Minimum of $200 must be transferred in 1 transaction.

Coinbase – Best for Newbies Holding USD Coins

Earn up to 1.25% on USD coins.

Coinbase is one of the most well recognized brand names for holding and trading cryptocurrency.

The coinbase digital wallet lets users earn up to 1.25% on their idle USD coins while you wait to make new trades. You also have less restrictions when it comes to withdrawing funds in your Coinbase digital wallet as Coinbase doesn’t loan your USD coins out to borrowers.

Linus – Best for Liquidity

Earn up to 4.50% APY + withdraw funds at any time with Linus.

If you’re looking for a solid rate plus easy access to your funds and limited withdrawal restrictions then Linus might be your best bet.

Many crypto savings accounts come with fees or restrictions when you attempt to withdraw funds prior to a specific date. This is not the case with Linus. Linus differentiates itself by allowing their customers to withdraw funds at any time, penalty free. If you need help, humans are available via online chat.

Linus provides an interest rate of 4.50% APY on your crypto stash. Linus generates interest by lending your assets to borrowers via smart contracts.

Crypto.com – Best for Cryptocurrency Diversity

Earn between 3.0% and 12% APY with Crypto.com.

If you hold some cryptocurrencies that aren’t the major household names and would like to earn interest on your holdings, then Crypto.com might be a good place to look. They currently offer great interest rates on the widest range of cryptocurrencies which currently feature 26 cryptocurrencies and 8 stablecoins.

You can earn a phenomenal APY of up to 12% on stablecoins and 6.5% APY on cornerstone cryptocurrencies like bitcoin. Simple daily interest is applied and deposited into your account weekly. Rates depend on the term of your deposit which can be flexible (you can withdraw anytime) up to 3 months long.

Nexo – Best for Rapid Payments

Earn up to 12% APY (paid daily) with Nexo.

Nexo’s claim to fame is limited lock-up times of just 24 hours or less. That means your interest payments are paid out daily.

Nexo has already racked up over 1 million users since its inception in 2017.

Nexo also has $100 million in insurance on all custodial assets.

There are no monthly fees or minimum deposit requirements to open an account.

Outlet Finance – Best for Dealing in US Dollars

If you do not study cryptocurrency trends but still want to dabble in the space and earn a handsome return while you do it, then Outlet Finance may be your best option.

You don’t need to know much about Crypto with this platform as they deal with U.S. dollars. Users deposit funds in USD and users earn interest in USD.

How it works: Outlet Finance converts your investment to stablecoin and then connects it with their overcollateralized lending partners, matching it with the highest yield.

Overcollateralized means their partners must put up 120% of their loan request. In the event that they default, this gets liquidated to pay the investor (you) which helps mitigate your risk.

The company advertises APYs up to 6%.

YouHodler – Jack of All Trades

YouHodler is a Swiss company that gets its name from the playful misspelling of the word “HOLD” which later utilized the acronym “Hold On for Dear Life” and was adopted by the investment community as a term to ‘hold’ or not sell your investment.

It makes sense then that YouHodler is designed to help long term crypto holders get additional earnings from their holdings.

YouHodler boasts yields between 3% and 12% depending on currency and investors can get started with as little as $100.

We awarded this platform with the Jack of All Trades title because it excels in most categories consumers care about: 1. Access to funds / liquidity. 2. High paying yields. 3. Diversity of coins accepted. Savings accounts and exceptional APYs are offered on 22 cryptocurrencies currently with YouHodler.

Interest payments are paid every week.

Gemini – Best for Security

Gemini claims to be operating with a security-first mentality since day 1.

Once you deposit your crypto with Gemini the majority of it is held in their “offline, air-gapped cold storage system” which helps prevent theft by hackers and/or malware. Only a small portion of your deposited crypto will be held in their online “hot wallet” and it is insured. You can get a full rundown of their security measures here.

APYs range from 1.54% to 7.40% depending on currency.

Interest is paid daily.

CoinLoan – Security and Safety Runner-Up

CoinLoan is an Estonian firm that specializes in security and safety like Gemini.

They also do a great job in supporting a wide range of cryptocurrencies, which currently sits at 17.

Their APYs range from 5% to 12.5% depending on cryptocurrency.

There are no minimum deposit requirements and interest is paid monthly.

Hodlnaut – Runner-up for Liquidity

Hodlnaut is another play on words with the term HODL, which is a common misspelling for HOLD plus the word Astronaut, to get Hodlnaut.

They are based out of Singapore and only accept deposits in 5 cryptocurrencies currently. These are BTC, DAI, ETH, USDC and USDT.

Hodlnaut does not currently hold any regulatory licenses in Singapore but is applying for them under the new regime. Visit their FAQ section to read more.

Interest is paid out weekly, every Monday.

APYs range from 6.2% to 8.3% depending on cryptocurrency.

What are Crypto-Based Savings Accounts

Before you open a crypto-based savings account it is probably a good idea to fully understand what these products are and how they differ from traditional savings accounts.

First, these accounts provide a yield on your crypto holdings, not U.S. dollars. There are several crypto banks offering fantastic APYs (annual percentage yields) on the USDC coin which is pinned to the U.S. dollar and generally trades in parallel, but it is not the actual USD.

In fact, these accounts should be viewed as investments rather than savings accounts, because that is really what they are at their core.

You invest in crypto currency and then lend out your keys to a third party in exchange for interest.

The precise activities going on under the hood with your crypto keys vary depending on which platform and account you choose.

We’ll touch on the mechanics and risks to these investments further on, but first, aside from the high interest rate, let’s look at some of the positive impacts crypto savings accounts are having to the overall cryptocurrency economy.

For starters, it’s an automated way to grow crypto portfolios over time. For example, if you are already fully invested in bitcoin, you can deposit that bitcoin into a crypto savings account and earn additional interest paid in bitcoin.

Also, crypto savings accounts continue to be an on-ramp for getting people to deposit their USD, CAD, AUD, and GBPs and convert them into a crypto savings account. By drawing in more participants to the crypto economy, greater liquidity can be attained leading to eventual price stability for the new asset.

Also, long time holders of crypto are incentivized to move their crypto out of storage and into the markets facilitating adoption and helping innovate new use cases for crypto.

In the end, interest rates are important in financial markets because they fill the gap between people with surplus assets they can’t use and the people who need the assets because they have a productive use. High interest rates being offered can be seen as demand for the underlying crypto assets.

How Much Can You Earn with Crypto-Based Savings Accounts

There are two main factors that are going to affect your overall earnings (or losses) from a crypto-based savings account:

The cryptocurrency’s price in U.S. dollars.
Interest rate paid on your crypto savings account(s).

The first main factor is likely going to be the biggest variable in determining your overall gains or losses. This becomes a bigger risk if you hold your savings account for a long period of time.

Cryptocurrencies are highly volatile, un-regulated, risky investments that are not backed by the government like standard currencies are. Therefore, if the cryptocurrency you are holding in your savings account goes down in value while your crypto savings account is active, it is quite possible to lose a portion of your principal.

This is a similar concept we discussed with the inherent risks of foreign currency CDs, where a great interest rate can be negated entirely if the currency you are holding goes down in value against the U.S. dollar.

The second variable is APY paid on your crypto savings. This varies widely on a number of factors.

Currently some of the top crypto banks outlined in this article are paying between 3.2% and 12.0% APY. To put this in perspective, the average savings account yield sits at just 0.05% APY according to recent FDIC data.

Who are these providers I’m lending my keys out to?

Exchanges and lenders are the businesses who take your keys and lend your crypto assets to others. These institutions will loan out the crypto assets to other borrowers who may be individuals or institutions who need liquidity and don’t want to sell their cryptocurrency. Most traditional banks are unwilling to take crypto assets as collateral for a loan which has opened the door for these exchanges and crypto lenders.

Currently, interest rates are relatively high as users can earn up to 12% in some cases. Additionally, by offering the high yield it helps attract and on-board more people into the crypto economy. This is because in order to earn the high rate of interest, you need to convert your fiat currency over into bitcoin or another cryptocurrency to get started.

That high rate of return has likely succeeded in attracting more people into the crypto economy. According to Statistia, 20 million bitcoin wallets were created from February 2020 to January 2021. This represents a 43% increase from the number of wallets a year ago.

Why would a business want to borrow at 8-12% annual interest?

It is great that savers like us get to benefit from earning a high interest rate. Who would be willing to pay 8-12% annual to borrow the cryptocurrencies?

Institutions are a large driver of crypto borrowing. If they have a mismatch on the timing of their debits and credits, they can park collateral with the lender, then pull out a short-term crypto loan to fund the mismatch.

Market makers and crypto dealers are a great example of this. If you make a large buy order of bitcoin, the market maker or dealer probably does not have bitcoin as it is highly unlikely somebody else is selling to them that exact amount at that same time. These market makers want to be neutral and not be exposed to a directional risk in bitcoin.

Therefore, they will take on a short-term loan of bitcoin until sell orders come in. At that point, they will repay the loan back with their new sell orders from their clients.

As another example, one of the benefits of cryptocurrency investment is the decentralized marketplace. There are many different places you can go to buy, sell, and exchange your crypto.

As a result, the pricing of bitcoin (and other cryptocurrencies) may not be EXACTLY the same and might vary by 1% or so at each of these venues. Arbitrage traders will look to profit from the difference in pricing from the various locations.

However, those arbitrage traders might not have the right cryptocurrency located at the venue where the mismatch occurs. Therefore, these traders would take on a short-term loan in their needed cryptocurrency to take advantage of those pricing dislocations.

The amount of interest the arbitrage traders pay in a year might be earned through their business in a few short weeks. Even though 8-12% of interest payable per year sounds like a lot, some business models are happy to pay for it which is to the saver’s benefit!

Lastly, some investors who feel the price appreciation of bitcoin or ethereum will be multiples greater than the 8-10% of interest they pay. As a result, they will consider depositing their crypto as collateral, then taking a US dollar loan out. They will then turn around and buy more crypto with the US dollars lent to them. As you can imagine, that is a risky move as you would be betting on the crypto you are purchasing will be more valuable later when you repay the loan. That is not always going to be the case.

Risks Associated with Crypto Savings Accounts

Though a crypto-based savings account has its benefits, there are risks of loss to investing in it. Let’s explore seven risks associated with these investments.

Exchange Rate Risk

Risk that the value of the underlying crypto goes down relative to your base currency (USD, GBP, etc). The value of a cryptocurrency is not backed by the government and is not legal tender. Additionally, the accounts to where the crypto is placed to earn interest are not subject to FDIC, SIPC, or other guarantees. If something happens to that cryptocurrency that would cause it to lose its underlying value, then you would lose your principal invested amount.

There are several different types of cryptocurrencies to earn interest on. The value of cryptocurrencies like bitcoin and ethereum are volatile and can easily lose their value quickly. Many crypto savings accounts pay their interest in crypto so not only is your underlying principal losing value, but the interest you are earning has less real value too. Of course, the opposite of that is true when you have an appreciating underlying asset.

As a result of volatile valuations, savors like to use stablecoins in their crypto savings accounts.

Risk of the Stablecoin Peg Breaking

Stablecoins are designed to hold a stable relative value to another asset, like the US dollar. If the stablecoin cannot hold its value relative to the assigned asset, then investors would lose trust in the stablecoin causing its value to potentially collapse.

It is important to note that not all stablecoins were created equal. Some stablecoins are centrally managed and promise to have US dollars locked away, in a vault with regular audits completed.

Other stablecoins are decentralized and are managed by computers and computer code rather than humans. It could be argued that each of these types of stablecoins bears their own unique risks.

In the former, the central institution could break their promise and mismanage the business causing the peg to the US dollar to break. In the case of the latter, an error in the coding could be discovered in the future that causes a break of the peg against the US dollar.

In case there is a break in the peg, investment may flee that stablecoin potentially causing loss of principal.

Lock Up Risk

Some crypto savings accounts are very flexible where you can withdraw at any time. Other crypto interest accounts may have lock up periods or additional fees for excessive withdrawal activity. Generally speaking, the more restrictive accounts will offer the higher interest rate while the more flexible accounts tend to offer the lower interest rates. Make sure to ask questions about a lock up period, withdrawal restrictions, and any additional fees before committing.

Pledge Risk

You no longer control the crypto and are pledging it as collateral. For example, when you deposit at a bank you are staking a claim to a bank’s liability. It is a similar situation with the crypto savings account (minus the government protections). If the crypto provider goes under due to a mismanagement of their business or an adverse market event, you will not be able to get your bitcoin or cryptocurrency back. This is because when you deposit the crypto into the savings account, you no longer own the crypto.

Loan Default Risk

If the value of the collateral backing the loan falls and is insufficient to pay back the lender, the load could be defaulted upon. Though this is a real risk, most crypto loans tend to be overcollateralized which greatly reduces the risk.

In other words, it is common for borrowers to maintain collateral equal to 150% of the loan amount. Therefore, if the value of the collateral decreases due to adverse market conditions, there is typically enough cushion to support the loan. It gives the borrower time to repay the loan or for the loaner to liquidate the position on the open market. The loan default risk could come into play if a rally harsh market correction drove the value of cryptocurrencies very low very fast. In essence, markets would have to crash 50% in a matter of minutes what hasn’t happened…yet.

Risk of Custodian Hack

A large risk factor is if the lending company’s custody provider (where the assets are stored) gets hacked. If you are utilizing an exchange’s crypto savings account, it is possible that a theft could occur due to a hack at their custodian.

Many people who are new to cryptocurrency are afraid of the blockchain getting hacked. However, the risk of a hack is not actually to the blockchain, but rather the institution’s security (or smart contract, see below) which is different from the blockchain.

It is important to understand that the ‘hack’ risk is increased when you are dealing with a newer institution or an institution whose investment in security is not as strong as others.

Typically, institutions that have been around longer tend to be stronger as they have stood the test of time.

Smart Contract Risk

Decentralized finance (Defi) lenders use automated coding called smart contracts to loan and allocate capital. This coding is viewable by everyone so it is quite transparent. Everyone is incentivized to make sure the coding is solid.

However, a previously undiscovered error in a smart contract may open the door for a hacker to find their way in. For example, a loophole in the code may cause the lender to lose the funds.

This has some similarities to the custodian hack risk as newer untested lenders may not have had their smart contracts battle tested. Though not exempt from the risk, lenders who have been around longer and whose products have stood the test of time are generally less likely to be exposed.

Crypto Savings VS Traditional Savings

Despite having the name ‘savings account’ in their title, crypto-based savings accounts have some very distinct differences from traditional savings accounts.

Above, we have touched on some unique qualities and risks to crypto-based savings. Below, we’ve outlined a side-by-side comparison.

	Traditional Savings	Crypto Savings
FDIC Insurance	Yes	No
Withdrawal Allowance	Generally unlimited	Can be Limited
Interest Calculation	Usually Compound	Usually Simple
Interest Deposited Best APY	Monthly ~0.3%	Daily or Weekly ~12.0%

FDIC Insurance

Variable rate deposit accounts including savings accounts, checking accounts and money market accounts opened with traditional banks or credit unions come with FDIC insurance (or NCUA insurance for credit unions) that protect your funds in the case of institutional insolvency while your money is held there.

FDIC and NCUA insurance cover deposits up to $250,000 per individual or $500,000 on joint accounts.

This is not the case with crypto-based savings accounts where it is possible to lose money – both interest and principal. Crypto investments are not covered by government insurance and are not considered legal tender.

However, many crypto institutions will provide insurance for certain risks of loss. Unfortunately, the biggest risk to loss is the exchange rate risk, which is uninsured. The exchange rate risk is why many crypto-based savers utilize stablecoins as they pin the value of the cryptocurrency to a standard fiat based currency (for example – USD, CAD, AUD, GBP).

Withdraw Limits

Per federal regulation D, variable rate deposit accounts at banks and credit unions no longer have limits to the number of transfers as of April 2020. The previous limit of 6 transfers was lifted in April 2020 as Covid-19 caused millions of Americans to lose their jobs, struggle to pay bills and needed to draw upon their savings in a time of crisis. Double check with your institution so you know what their limitations are so as to avoid excess transaction fees.

Crypto savings accounts, on the other hand, can have tighter restrictions on withdrawing funds. Some crypto-based deposits are contractual and you have to keep your deposit on hand for a certain time period limiting your ability to withdraw. Other crypto-based deposits may be flexible, but offer a lower rate of return for that flexibility. Lastly, some institutions charge set up fees too.

As crypto-based savings accounts are a relatively new product, regulation surrounding them hasn’t been established so check with the institution regarding their limitations and fees before making your deposit.

Interest Calculations and Interest Deposits

Another major difference in these accounts is how interest is calculated and when your interest gets deposited.

Most banks and credit unions compound interest daily, weekly or monthly on your deposits. Compounding interest allows for the interest you’ve accrued to also earn interest.

With crypto-based savings accounts however, simple interest is generally applied. That means your initial principal is the amount to which interest calculations are made.

One interesting advantage to crypto-based savings accounts is that many institutions actually deposit your interest in shorter time increments like daily or weekly rather than one interest deposit per month seen by banks and credit unions. This quicker release of the interest allows you to put it to use more quickly.

Final Thoughts

If you already hold cryptocurrencies, then moving your funds into an interest bearing account is a great strategy to earn while you hold.

That said, if you’re considering investing in cryptocurrency because of the enticing APYs you see on the savings side, be sure you fully understand the inherent risk of these highly volatile digital currencies.

You’ll also want to study each account and crypto bank carefully as terms and conditions, interest rates, minimum deposits, types of cryptocurrencies needed and lock-up periods vary widely from account to account.

If you’re typically a conservative saver that generally invests in traditional CDs, savings accounts, money market accounts and the like, then these accounts probably aren’t going to be for you. They are also not a wise place to stash emergency funds or any funds you may need to convert to cash quickly.

Also keep in mind these are variable rate accounts that are subject to change at any time without notice.

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What are Crypto-Based Savings Accounts

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Who are these providers I’m lending my keys out to?

Why would a business want to borrow at 8-12% annual interest?

Risks Associated with Crypto Savings Accounts

Exchange Rate Risk

Risk of the Stablecoin Peg Breaking

Lock Up Risk

Pledge Risk

Loan Default Risk

Risk of Custodian Hack

Smart Contract Risk

Crypto Savings VS Traditional Savings

FDIC Insurance

Withdraw Limits

Interest Calculations and Interest Deposits

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