BlockFi or Celsius Network: the Talk About Amazing World of Crypto Loans and Savings

Have you ever heard about BlockFi or Celsius Network? These companies are levelling the playing field and paying more interest on your salary than the U.S. banks. They both are based in New-York City. What’s a difference between them?

Crypto Savings

Some argue that Celsius Network is not decentralized, it’s centralized and is a part of the CeFi world. BlockFi has a better image but some still wonder about its blockchain and smart-contracts in its activities. In search of “truly decentralized” some immerse themselves into DeFi. Anyway these platforms have interesting saving/staking and loan features.

Everyone may gamify saving into investing.

1. Save 1-2 months income.

2. Start moving everything above that into your preferred investing vehicle (you should be studying while you save 1-2 months).

3. Find passive ways to create more income (BlockFi, Celsius Network, etc).

4. APY paid monthly or weekly, so you can withdraw your interest.

This is the definition of stacking Sats every day.

People sometimes use both platforms. BlockFi provides 8.6% APY paid monthly (one free withdrawal per month with a 0.0025 Bitcoin withdrawal fee after that) and allows monthly compounding, not weekly, unfortunately. To earn 8.6% on holding stablecoins (for example, USDC) is more than any high yield saving account could ever do. If you have Bitcoins you can earn 6% interest with BlockFi.

The other platform, Celsius Network, offers an interest of 10% APY paid weekly but it is simple interest. The most lucrative rates are offered in case you use native tokens of Celsius Network, CEL. BlockFi has no such incentive program but some think this is an advantage of BlockFi that they don’t shill any coins.

Crypto Loans

It’s an interesting service to free yourself from the traditional banks. Millions of people have the chance to do this. BlockFi and Celsius Network issue dollar and stablecoin loans with Bitcoin and other cryptocurrencies as the collateral. BlockFi offers low cost loans, at rates as low as 4.5% and collateral amount based on a 50% Loan to Value (LTV) as far as it concerns Bitcoins.

It’s possible to take out a loan of say $50,000 from Celsius Network using say XRP as collateral. Interest rate is just 0.65% per year. Celsius Network has a minimum threshold ($500) for borrowings. LTV rates vary from 25% to 50%.

Sounds good but… Your coins can face a margin call if their prices go extremely down and collateral will be liquidated. It’s the best market form of collateral because it’s highly liquid and trades 24/7/365 and thus can be automatically liquidated if needed.


It’s usual that some participants of the crypto sphere hold most of their savings in Bitcoins in cold wallets but this strategy doesn’t bring about an interest. They start thinking about moving their BTC to BlockFi or Celsius Network, to make some interest, but they’re a bit afraid of losing their crypto assets.

There’re various risk-taking strategies. For example, put a portion like 40%-50% on a ledger. And the other 50-60% split between BlockFi and Celsius Network. So you don’t have the risk putting all into one platform to accumulate interest.

There is always risk. Any project may blow up in your face one day. Some argue that interest-collecting-in-crypto is going to end one day and it’s not going to end well since they may lose all their keys to staked cryptocurrencies.

But these doomsayers really don’t understand how any of this works. The legacy financial institutions such as Fidelity also make money off of zero cost mutual funds when they lend out the underlying securities. BlockFi and Celsius Networks are doing the same with assets. BlockFi generates interest on assets held in savings accounts by lending them to trusted institutional and corporate borrowers. There is a spread. They share it with their customers. By the way, Avon Ventures is an investor in BlockFi which is a venture capital subsidiary of Devonshire Investors, the private equity arm of Fidelity Investments’ parent company. And it’s huge.


At any rate, the main drawback in crypto savings is that you are no longer in control of your private keys when you start exploring crypto savings accounts. You are trusting someone else to custody your Bitcoin and other cryptocurrencies for you even in case of BlockFi you deal with an esteemed Gemini Custody.

Borrowing is also very risky. You need enough collateral and when you borrow you give up control of your keys. Make sure the collateral needed can support a drastic price of your cryptocurrencies.

Dmitry Leiko

My name is Dim. I am a marketer and cryptocurrency enthusiast. I have consulted on SEO issues for companies such as, cointelegraph and other major media. I am interested in DeFi and cryptocurrency loans. I study this field, test different companies and share honest experience on this site.