How to Earn Interest on Bitcoin

How to Earn Interest on Bitcoin (up to 40% APY)

How to Earn Interest on Bitcoin (up to 40% APY)

Bitcoin has become one of the most popular cryptocurrencies in the world, with millions of people investing in it for its potential to generate high returns; however, many investors are not aware that they can also earn interest on their Bitcoin holdings with a crypto interest or savings account, which can help them generate even more returns!

In this guide, we will explore how to earn crypto interest and where you can earn up to 40% APY on your crypto assets.

Start Earning Interest on Bitcoin

If you’re ready to start earning interest on Bitcoin (BTC), this guide will help you get started. While our site does not offer financial advice, you can use our in-depth data, interest rates and platform reviews to gain a clear understanding of the current market and offerings across the industry (we track over 40 platforms).

Crypto savings accounts that earn interest are growing in popularity, and it’s easy to see why. Simply depositing your crypto and watching them grow is an exciting and passive way to be a part of the cryptocurrency world and grow your assets.

πŸ€” Curious how much interest you can earn on Bitcoin? Check out our Bitcoin Interest Calculator tool, which does the math for you.

Now, let’s learn how you can earn interest on your Bitcoin… specifically with lending and pools!

1. Bitcoin Lending

Bitcoin lending is the most popular way to earn interest on your Bitcoin holdings.

Lending your Bitcoin involves borrowers who you lend to and then earning interest on the loan. Lending platforms often reinvest your deposits into other trading accounts, where they earn yield on your behalf. The interest rates for Bitcoin lending will vary depending on the platform, the borrower’s creditworthiness, and the success or failures of their lending tactics.

Learn more about crypto lending in our ‘what is crypto lending‘ guide.

See also:  Best Places to Earn Daily Interest on Crypto

Earning Bitcoin Interest with Nexo

βœ… Global platform with millions of users, wide crypto asset support

β›” Lower interest rates compared to alternatives, not available in the US

nexo crypto platform homepage

Nexo is a crypto lending and crypto account platform that was launched in 2018. Based in Switzerland, Nexo offers its users a range of earning options, including fixed-term and flexible-term deposit accounts. The platform currently supports the most cryptocurrencies of all platforms we rank, meaning you can earn interest on more than just Bitcoin (like stablecoins). Nexo also offers full crypto exchange services to buy, sell and exchange your crypto holdings in a single service.

β˜‘οΈ Full Nexo review & interest rates

2. Bitcoin Pools

Another alternative to earn interest on Bitcoin is depositing your Bitcoin into a Bitcoin pool. These accounts work like lending, where you deposit your Bitcoin and earn interest or rewards on it over time, but in this case, funds are grouped together to earn higher returns. Sometimes these are referred to as mining pools, as they may generate some of the returns through Bitcoin mining.

The Bitcoin pool will take your deposited funds and deploy them across a variety of incoming generating methods, such as trading, mining initiatives or DeFi protocols like liquidity pools or yield farming. Since funds are “pooled,” they typically can earn much higher rates than an individual can alone.

The interest rates for Bitcoin trading pools vary depending on the platform.

3. Bitcoin Staking

Staking is a popular way to earn interest on cryptocurrencies, however, you cannot stake Bitcoin.

Staking requires proof of stake protocol cryptocurrency and pays native staking rewards for validating transactions on the blockchain as part of its native protocol. Bitcoin, however, is a proof-of-work cryptocurrency, and miners are the ones that receive these rewards. But with the crypto interest account options above, you can earn stake-like returns with Bitcoin by lending or using a Bitcoin pool.

See also:  How (and why) to earn compounding interest with crypto

Our Takeaway on Earning on Bitcoin

For those with an aggressive investing mindset and who want more returns than is possible with simply HODLing, earning interest on Bitcoin with lending and pools are a potent way to generate even more returns on your initial investment beyond price appreciation alone.

Bitcoin lending is the most popular way to earn interest on your BTC, and Bitcoin pools offer very enticing interest rates by grouping up users’ assets and deploying them.

DYOR: Risks involved with earning interest on Bitcoin

The interest rate is one of the multitude of factors you should consider before lending or depositing your Bitcoin into a third-party crypto interest account.

Using any centralized platform where you deposit your crypto is not risk-free (you are entrusting you can withdraw your funds at a later date, which some platforms have failed to do in the past (i.e., Celsius Network, FTX Earn, Hodlnaut, and others).

Consider the length of the platform’s operation, the team behind it, check out reviews and what other users are saying, where they are based out of, and likely most important, how they earn the returns. All of these factors are important to gauge your risk and trust in a platform.

By exploring these options, understanding the platforms, doing your own research, and finding the right platform for your needs, you can earn interest on your Bitcoin holdings and maximize your returns.

Questions & Answers

Earning Interest on Bitcoin

Can you earn interest on Bitcoins?

You can generate interest returns from your Bitcoin holdings with lending and trading pools.

How to earn interest on Bitcoin from lending?

To earn interest on your Bitcoin holdings through lending, follow these steps:

1. Choose a lending platform. We rank services that support Bitcoin.
2. Create an account: Sign up for an account on the chosen lending platform.
3. Deposit your Bitcoin.
4. Choose your lending terms: Some platforms offer flexible terms, such as choosing the duration of the loan.
Start lending: With your Bitcoin deposited and lending terms set, the platform will typically handle the process of lending your funds to borrowers. You may start earning interest immediately or after a short waiting period, depending on the platform.
5. Monitor and manage your investment: Regularly check your account to review the performance of your loans and interest earned.
6. Withdraw your earnings: Once you’ve earned interest on your Bitcoin lending, you can withdraw your original Bitcoin deposit and/or interest earned according to the platform’s withdrawal policies. Be aware that some platforms may have withdrawal fees or minimum withdrawal amounts.

It is essential to research each platform thoroughly and only lend the amount of Bitcoin you’re comfortable losing, as lending is not zero risk.

How much interest can you earn on Bitcoin

Bitcoin lending and mining pools can return between 4-10% APY, depending on the platform.

Risks with earning interest on Bitcoin

When you deposit crypto into a platform, you are entrusting them to return the money at a later date. Platform risks may include security risks or hacks, bankruptcy, liquidity issues and more. Learn more about managing crypto lending risks in our guide.

Nexo: Get up to $500