Crypto lending platforms such as BlockFi and Celsius have experienced phenomenal growth since 2020, attracting millions of customers by offering yields ranging from a few percentage points to as high as 17% to individual investors. These platforms take deposits and lend them to institutional investors, returning most of the proceeds to customers.
Through this business, assets under management have increased by 1,711% in 2020 alone, according to BlockFi. Its rivals Nexo and Celsius have also experienced huge growth, with Celsius increasing assets under management by more than 1,900% in less than a year.
As of March 2021, BlockFi held $14.7 billion in assets through its BlockFi interest-bearing account, while Nexo and Celsius held over $12 billion and $20 billion, respectively. BlockFi previously offered 6.25% interest to users who held more than one bitcoin.
Right now, it offers 1% – 3% interest for users who hold 0.35 BTC and an additional 0.1% interest on larger amounts. Likewise, Celsius adjusted the return to 3.05% from 6.2%.