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Earn While You Sleep With Crypto Compounding

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Avatar for Jane
Written by   1169
2 months ago

April 12, 2021

Aside from staking and farming, we can also put our assets to work and earn daily interest in compounding. And for those who don't know, Compounding is like depositing your money in a savings account, but since we are in the crypto space, it's using a decentralized, blockchain protocol. But instead of sending your money into the bank, you are putting your crypto into a compound wallet.

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And just like lending to a bank, you will start earning interest on the crypto you have deposited after a minimum of 24 hours of your time of deposit. The interest that you will earn is denominated in the same crypto that you lent.

For example, if you have lent BCH, you will earn interest in BCH. Then the BCH you lent will be added into a giant pool of BCH in a smart contract protocol, sent by thousands of users from different parts of the world.

How is compounding interest calculated?

The daily interest is credited into your Savings Wallet and is then calculated in your upcoming interest transactions.

Principal amount (in original crypto) x (APY/365) = Daily Interest

Your interest is automatically paid into your wallet and will be added to your initial deposit so that the next day you will begin to earn interest on it too.

For example in Nexo, you can earn up to 12% on crypto assets and they have types of saving terms: FLEX or FIXED.

The Fixed Terms allows you to earn 8% in crypto and 12% in fiat. Your crypto must be held up to the end of fixed terms (for ex. 1 month), and cannot be withdrawn or used as collateral for the loan, but can be canceled through sending a request to their customer support. If your assets are in Fixed Terms, they will be protected against liquidation while the term lasts.

The Flex Terms is their regular Earn offering across crypto, fiat, and stablecoins which allows you to withdraw funds at any time.

And Nexo has Loyalty Tiers: BASE, SILVER, GOLD, and PLATINUM.

The interest earned is determined by your Loyalty Tier and the type of payout.

(If your interest earned is paid in the same crypto, there is no additional bonus. But if your interest earned is paid in Nexo tokens, you will receive an additional 2% bonus on all your holdings.)


On the first day of April, I have transferred my read.cash earnings (January to March) except with the $300 sir Marc gave me (it is saved in my Bitcoin.com wallet) to Nexo to earn daily interest.

BCH 0.15398066 (Nexo balance) + 0.76682658 (read.cash earnings) = 0.92080724

At the time of writing, it's already 0.92190494 BCH and earned 0.0010977 BCH from April 1 to date.

I have also lent my 0.3+ ETH on Nexo last October 2020. But I have transferred 0.1+ to Binance for spot trading last February and another 0.1+ last month. It was April 1 when I checked my balance on Nexo and my remaining ETH was 0.05605628 ETH. As I checked it at the time of writing, it's already ETH 0.05611991 and earned 0.00009378 ETH.

Since the interest is compounding, it is increasing day by day and my account is on a Base tier so I am earning 5% daily interest. Here's some of the weekly interest I've got from Nexo from October to April 5.

You will be notified about your earned interest weekly. As you can see from the photo, even if I have withdrawan some of my ETH last February and March, the earned interest is still increasing since it is compounding. The total amount I have on Nexo at the of writing is $750.77 with ! credit line of $292.83 for both BCH and ETH.

Is it really safe to compound your crypto on Nexo?

Nexo has $375 million insurance on custodial assets through Lloyd's of London. They also have cold storage in bank-grade Class III vaults through the SOC 2 Type 2 certified crypto custodian BitGo. Moreover, all funds are backednby Nexo's portfolio of 200-509% overcollaterized crypto credit lines. And they have zero fees and no minimum contribution required when you register on Nexo.

Aside from lending on Nexo, you can also borrow money from the platform but you need collateral. But of course, it is not advisable to borrow crypto as it has liquidation risk and you might just lose all your money if the market move against you.

Compounding is a good way to put your money to work while you sleep. This is good for long-term investment. The longer you lend your crypto, the higher the returns your will get. Just make sure to put your crypto on a safe compounding platform like Nexo and Blockfi. These two are the top platforms for crypto compounding.

And for those who are afraid of impermanent losses in crypto farming, it is much better to do compounding. The initial earned interest might be small, but it will increase as you hold your money longer in your compound wallet. But always remember to DYOR before investing in any platforms to avoid losing your money. And of course, do not invest more than what you can afford to lose.

More ways to earn crypto:

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Grab These New Crypto Opportunities


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Avatar for Jane
Written by   1169
2 months ago
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Comments

Excelente articulo, muchas cosas que aprender para los que estamos empezando en este apasionante mundo de cryptos.

$ 0.00
2 weeks ago

By the way, ano ibig sabihin ng credit limit dito..is this related sa loan option?

$ 0.00
2 months ago

i love how you write this article...super naintindihan ko talaga... i will look into these sites

$ 0.00
2 months ago

Wow. grabe na yung earning mo. hehe. tapos nalaman ko pa tong crypto compounding na ginagawa mo which shows that you are planning to do it for a long-term investment. Ikaw na talaga. hehe . Uwi ka na. nasayo na korona eh. hehe. Keep it up!!! Sa akin malayo layo pa sa katotohanan.hehe

$ 0.02
2 months ago

Liit lng yan compare sa iba.. May losses pa ko this month

$ 0.00
2 months ago

Sa akin malaki na yan compared sa meron ako 😅

$ 0.00
2 months ago

Ang tagal ko kan diko naencounter yang compounding na yan haha. Diko na kasi pinag kaabalahang alamin 🙈. Pero sana all talaga o amg daming kwarta. Grabi ganyan palang laman ng Bitcoin.com wallet ko ee 🙈.

$ 0.02
2 months ago

Madami nadin yan ah.. May binance kpa.. Bilis mo nga makaipon kesa sakn.. May mga losses pa ko

$ 0.00
2 months ago

Wala din naka ilang withdraw na kaya ako 🤧

$ 0.00
2 months ago

Haha Jane, you're too much. I just love reading your article, keep it up!!!

$ 0.00
2 months ago

Sana all may maraming pamg invest.. Maganda rin toh base on your review, for now nasa Binance lang ako.. Thanks for this!

$ 0.02
2 months ago

Nagtitrade kna? Pwd ka rnagstake dun

$ 0.00
2 months ago

Sounds like traditional banking strategies. I have not yet risked participating in this platform. I'm going to think about it, I like being my own bank.

$ 0.02
2 months ago

Yup . but in a blockchain.. And it's a good way to earn interest while holding your crypto.. Better than the traditional bank I guess.

$ 0.00
2 months ago

Yup . but in a blockchain.. And it's a good way to earn interest while holding your crypto.. Better than the traditional bank I guess.

At least, it sounds good and is worth exploring with what you can afford to lose.

Thanks for such an excellent article.

$ 0.00
2 months ago

Thanks for reading too 😊

$ 0.00
2 months ago

Whoa! Jane would it be fine if I lend say $50 to Nexo? And when time goes by keep on transferring earnings there?as of the moment thats what I have in bitcoin.com most of the other earnings I have are transferred to coins ph for easy convert to fiat in case needed.

$ 0.02
2 months ago

The earnings are not actually that big especially if you only lend a small amount.. You can check my earnings there... But it's the safe way to put money to work and this is good for long term investment

$ 0.00
2 months ago

Ill think about it. Ill see if I can add up more. I never really invest since personally without read and noise got no savings. Just survived one of the hit of life. Lol

$ 0.00
2 months ago

Without these two platforms too, I wouldn't have extra savings by now..

$ 0.00
2 months ago