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Is Hodlnaut the winner of Centralized Finance (CEFI)?
As I try to make all this staking and interest/loan rewards completely passive, building a principal able at some future moment to pay me weekly or monthly more than my actual wages, I am always searching for options, and i enjoy testing them. In the initial phase, many of them are all milk and honey, but after a while, sooner or later, they will show there true colors. Because, like me, and like you, even the companies are into crypto for money. For profit. Until recently I was using Celsius, where I get a nice $60-75 per week, and BlockFi, where I only get $2.5 monthly, for some BTC that ended up there in the testing phase.
Another one of this CEFI (centralized finance) that managed to got my attention is Holdnaut, as it has combined both Blockfi advantages of an internal tokens swap with Celsius decent interest rates. Or maybe they are even better, let's see it.
As you can see, the interesting bit is that the first tier is up to 2 BTC, which is significant compared with, for example Blockfi, where the first tier is 0.1BTC. Second ties is 8 BTC, so we may have a decent return for up to 10 BTC. Third tier is up to some impressive 90 BTC. This is good enough for me.
On ETH, first tier is up to 20 ETH, second tier is up to 80 ETH, and after that it is just some flat 2% interest rate. Even the stablecoins are looking yummy, with the first tier up to 25.000, second tier up to 75.000 and third tier up to 400.000. This is a good half a million we are talking. All this may not say much to you, but don't worry, I have here the rates for the other big CEFI companies, to compare and learn about it. So, Blockfi, also had the advantage of an internal swap, but their latest limits on lower tiers are horrendous. Take a look!
As you can see, on BTC, Blockfi first tier is 0.1 BTC, second tier is up to 0.35, and after that is a flat interest rate. We will talk about interest rates a bit later. So we have Hodlnaut paying for your first 10 BTC (tier 1 and 2) more than Blockfi prime interest rate (which applies only to 0.1 BTC). If you have the numbers, the choice is clear.
ETH next, on Blockfi we have up to 1.5 ETH on tier 1, up to 50 on tier 2, and flat interest rate above that level. I have an issue with this, as having more that 50 ETH will enable you to maintain a node, having much more rewards that the measly 0.25% offered by Blockfi.
Stablecoins, I have just compared USDC, randomly, as all the main stablecoins have the same interest rate. In our Blockfi case, tier 1, up to 40.000, pays 8%, while Hodlnaut first tier, up to 25.000, pays 12%. After the mentioned ammount, Blockfi offers a flat interest rate of 5%.
So, in conclusion, looks like Gemini, under Blockfi umbrella, it is just trying to make more money using your crypto, and paying you next to nothing (in terms of crypto, if we compare with the 0.01% interest offered by our banks on current accounts, this is another can of worms, that I will better not open it now).
Let's have a look on Celsius Network. They have slightly better interest rates, but no internal swap. There are rumours that they will add one soon, but nothing is there yet.
Celsius is a bit better, as their tier one is 1 BTC, with 6.20%, dropping to 3.51% after that. For ETH, tier one is up to 100 ETH, at 5.35%, not decreasing that much after that, at 5.05%. Stablecoins have no tiers, with 8.88% interest rate. We had a lot of fun, didn't we? Let me play with some numbers.
For 1 BTC, for one year, we have the following returns:
Celsius - 0.062 BTC ($3208)
Blockfi - 0.00765 BTC ($395)
Hodlnaut - 0.072 BTC ($3725)
And the winner is Hodlnaut.
For 100 ETH for one year, we have the following returns:
Celsius - 5.35 ETH ($21.078)
Blockfi - 0.9275 BTC ($3654)
Hodlnaut - 4.64 BTC ($18.281)
For Ethereum, Hodlnaut is the best choice for up to 20 ETH, but if you have more than that, than Celsius is the obvious choice.
Stablecoins, this one will be tricky, let's consider that we have 40.000 USDC for one year:
Celsius - 3552 USDC ($3552)
Blockfi - 3200 USDC ($3200)
Hodlnaut - 4005 USDC ($4005)
What we learn from here? Up to 25.000 in stablecoins, there is really no other choice than Hodlnaut. Up to 40.000, still Hodlnaut is the best, but after that Celsius has a slight advantage.
Talking about withdrawals, Hodlnaut has no minimum withdrawal, but you need to pay a fee, Celsius has free withdrawals above certain amount, while Blockfi only has one free withdrawal per month. This will make Hodlnaut a choice for people owning a lot of crypto, as you need to cover your transaction fee, so that also means that you need to hold your horses for quite a while in there, to make it worth it.
There is still a good side, as there are no deposit fees, and you can even sell the top and buy the dip using stablecoins and ETH/BTC (no fees for using the Hodlnaut token swap feature)
All these being said, they are paying you interest every week, more like Celsius. Blockfi is paying the interest monthly. Extra: Hodlnaut is a certified Fintech, accreditated by the Monetary Authority of Singapore, and it is close to become the first regulated entity in Singapore as a Crypto Borrowing and Lending Provider. Find more about it at http://hodlnaut.com if you feel the need to check on them.
All the best,
...have fun and win rewards on my favourite blockchain games (Splinterlands - Hearthstone-like card game) (Mobox - GamiFI NFT platform) and (CryptoBrewmaster - Beer factory sim).