Copy of Review 1 - Blank

BlockFi Interest Account Review

Last Updated: Aug 13, 2022  |  Published: Mar 31, 2021

This post may contain affiliate links. Learn more.

BlockFi has become a popular centralized finance (CeFi) app that lets you earn compound interest on your crypto without having to lock it up.

If you've seen "high interest" savings accounts at traditional banks, the rates are close to 0%. BlockFi is trying to disrupt the traditional banks by letting you earn up to 11% APY on your coins.

Of course, it comes with risks. However, an 11% interest rate was worth exploring so I started testing it. This BlockFi review shares my research, personal experience, and if the risk is worth the reward.


BlockFi Overview

Updated: May 18, 2022

Coins Offered

35+ (also varies on your region)


Up to 11% APY

Monthly Fees


Minimum Deposit



Once per month


Deposit $100 or more to get up to $250 free


🇺🇸 Jersey City, USA

Video Review

Don't want to read? Watch my video review published on May 19, 2021. Refer to the rest of the blog post as well in case parts of the video are out of date.

About BlockFi

Updated: May 19, 2022

BlockFi is a centralized company founded in 2017 and based in Jersey City, USA. They are headquartered in the USA but their interest account is available in most countries worldwide. BlockFi has multiple products like their interest account, crypto credit card, crypto backed loans, a trading account, and more.

Some Stats:

  • Founded in 2017
  • Regulated company
  • Backed by Coinbase Ventures, Morgan Creek, and more
  • Over 1 million clients
  • $700 million in rewards paid to clients
  • $10 billion in assets held

Pros & Cons

  • Up to 9.3% passive income on your crypto
  • Get paid on the first of every month
  • Earn with any amount, no minimum balances
  • Regulated company that's backed by Coinbase Ventures, Fidelity, and more
  • No contracts or lockups required
  • Good reputation so far (backed by big names, $700m in rewards paid)
  • Centralized company
  • Interest is only 0.1% for some coins
  • Lower interest rates than some competitors
  • Your funds are not insured like a traditional bank account
  • Slow crypto withdrawals! They manually review your withdrawals
  • Not transparent about who they loan money to

BlockFi Interest Account

Updated: May 18, 2022

The BlockFi interest account lets you earn up to 11% APY on various cryptocurrencies like Bitcoin (3%), Ethereum (3%), Litecoin (3.5%), USDC (7%), and more (official rates).

You just deposit your crypto and on day one you start earning interest which will automatically be deposited into your account at the beginning of every month. Your crypto is not locked in a contract either. You can withdraw your funds at any time which makes BlockFi very interesting.

How Does BlockFi Pay You Interest?

BlockFi pays up to 111% interest which is way higher than traditional banks so how do they pull this off?

Here is the key information I found on BlockFi's website:

  • "BlockFi generates this interest by lending out your assets to trusted institutional and corporate borrowers."
  • "To ensure loan performance, BlockFi typically lends crypto on overcollateralized terms."
  • "BlockFi implements very thoughtful risk management practices and technology to mitigate the risk, but you should not view the BlockFi interest account as a savings account or brokerage account with FDIC or SIPC insurance."

In summary, BlockFi makes money by lending out your funds to companies and they are sharing that interest rate with us.

To mitigate risk, they claim to have processes to keep the funds safe. The biggest one is overcollateralizing the loans. For example, to get a loan of $10,000 you must put $12,000 worth of Bitcoin which acts as collateral. If the borrower doesn't pay back the funds, BlockFi takes the collateral. If the value of the collateral drops in value, BlockFi can also issue a margin call for the borrower to put up more funds.

Overcollateralized loans are good in theory because it motivates borrowers to pay back the loan in order to get their collateral back and it will also reduce the number of companies taking out risky loans. If the borrower defaults anyways, BlockFi has the collateral as a backup.

What Are The Risks?

The crypto market just witnessed the Terra ecosystem collapse so anything is possible.

BlockFi is good at marketing and saying the right things but what are the risks they're not advertising? Let's look at them.

1. It's a Centralized Company

Once you move your crypto off a hardware wallet, you are no longer in control. BlockFi can shut down your account, disable withdrawals, or do whatever they like and there is nothing you can do. This is the risk with any centralized company whether it's BlockFi or a crypto exchange such as Coinbase.

2. Your Funds Aren't Insured

Depending on your country, traditional banks usually insure your funds incase of loss. However, when it comes to BlockFi and crypto, there is no insurance. If your funds are lost for whatever reason they are gone for good.

3. Bankruptcy Risk

This relates to being centralized but if BlockFi goes bankrupt or if there's a potential disaster scenario in the market, the whole ship could theoretically sink. For example, if BlockFi isn't doing overcollateralized loans like they promise and they take on too much risk, a crazy market crash could put the company under. Imagine if they are doing fractional reserves and everyone tries to withdraw their funds at the same time or if they are only paying rewards from new clients joining in.

4. Cyber Attacks

BlockFi and crypto exchanges have big targets on their back from hackers. In my research, BlockFi did have a hack in 2020 and again in 2022. In 2020, the hacker got access to an employees phone via SIM swap. The good news is no funds were lost and BlockFi has never lost users funds since being founded in 2017.

5. A Bank Run

In theory, BlockFi could disappear tomorrow and be gone forever. However, they are pretty well regulated in the USA so I'd say this is becoming less of a possibility. It is the crypto industry though and we're covering all the risks here.

6. Extreme Market Conditions

Like mentioned in the bankruptcy point, an extreme market crash could destroy BlockFi if they are not doing overcollateralized loans like they promise or if they are not managing risk correctly.

Good news is BlockFi did survive the massive March 2020 crash as well as some 50% crashes since then. This could have been ugly if they were not managing risk correctly so they have some track record now.

7. Transparency

Lastly, BlockFI is a private company and we don't know what's happening behind the scenes. We don't know for certain who they're loaning money to, we can't confirm how overcollateralized the loans are and we have to put trust in their team. It's not that BlockFi isn't transparent, but we don't know everything behind the scenes.

Why Might You Trust BlockFi?

We've looked at the risks, now let's see the positives and why BlockFi might be trustworthy: 

1. Overcollateralized Loans

If BlockFi is doing this on all of their loans that's a good sign and lowers risk dramatically. Another good thing is if the price of the collateral drops significantly, BlockFi will send the borrower a margin call to add more collateral.

Unfortunately, we can't 100% verify who the borrowers are or the exact details of these loans unless BlockFi shares it. In general though, we like overcollateralization.

2. Black Thursday Performance

According to Wikipedia, the March 12, 2020 crash was the biggest single-day fall since the 1987 stock market crash. Since BlockFi is relatively new, we don't have a 50 year track record we can look back on so it's good to see they were tested in March 2020 and survived.

3. They Are Well Funded

So far, BlockFi has raised over $350 million in venture capital and they are backed by really big names. If anything goes wrong they have a bunch of VC's in their back pocket and can raise capital quickly. So far, the funding has come from big names like Morgan Creek Digital, Galaxy Digital, Fidelity, Coinbase Ventures, and many more. These partners are putting a bit of their reputation on the line and gives BlockFi some legitimacy as well.

4. They Are Well Regulated and Licensed

BlockFi is based in the United States and shows all of their licenses online. It's good they're in the USA where there is lots of structure and legal procedures. Overall, there are more consequences for running away and stealing money versus some other countries.

5. Cold Storage and Security

Lastly, BlockFi has a cold storage policy and they say all funds are securely stored with Gemini. Gemini is a big name in the crypto space with over $20 billion under custody for many institutional clients.

BlockFi also states they do extensive background checks for hiring employees, they provide them cyber security training, make sure all company equipment is secure, they plan for disaster event scenarios and more.

BlockFi Fees

Updated: May 18, 2022

Crypto Withdrawal Fees



Minimum Withdrawal


1 free withdrawal per month then 0.00075 BTC

0.0000274 BTC


0.015 ETH

0.0000001 ETH


1 free withdrawal per month then 50 USD

0.000001 UDST

Customer Support

Updated: May 18, 2022

BlockFi offers phone support and live chat support Monday to Friday from 9am to 8pm EST. There is also a knowledge centre with articles an FAQs. 

BlockFi Customer Service

The Bottom Line

Updated: May 18, 2022

Ultimately, BlockFi was founded in 2017 and is still a relatively new company. On one hand, they are well funded, backed by big names, have $10 billion in assets, and they have many licenses in the USA. On the other hand, anything can happen in crypto (like the recent Terra collapse). 

For some, BlockFi will be too risky. For others, up to 11% APY will be worth it for a small percentage of their portfolio. You must decide wha risk/reward it worth it for you. But overall, I don't think anyone would recommend having 100% of your portfolio in BlockFi.


  • Earn up to 11% APY
  • Start earning on day one
  • Get up to a $250 deposit bonus



Deposit $100+ and get up to $250 free