TL;DR- To withdraw from BlockFi, you’ll first swap your crypto for a stablecoin (either GUSD or USDC), then hit the withdraw button on top. There’s no withdrawal minimum. There are two options available for withdraw: ACH (free and takes 2 business days max in my experience), and Wire transfer (same business day but runs $20-$30 in fees).
In a couple terms: interest and lending. BlockFi has created a name for itself by attempting to bring standard financial services to the crypto realm. Users get interest on their bitcoin or use it as collateral for loans, which is a feature that few rivals provide. Customers may earn up to 4.5 percent annual percentage yield (APY) on their Bitcoin, based on the amount they have on the platform. Interest on stablecoins like Gemini USD is north of 8% APY. That’s about 50 times better than my brick & mortar bank rate.
A strong reason why I’m a crypto enthusiast is that I think it’s highway robbery banks pay their savers such low fees while our federal governments happily inflate away our earnings at 5-6%.
BlockFi has free monthly withdrawals. While BlockFi’s withdrawal costs aren’t the lowest we’ve observed, you can avoid them by restricting your withdrawal frequency. Each calendar month, the site offers one free crypto withdrawal and one free stablecoin withdrawal. If you use ACH to your bank and are willing to wait, there’s no fee.
What are BlockFi’s withdrawal fees?
BlockFi grants its users one free cash or crypto withdrawal per month. After that, users are charged 0.00075 Bitcoin ($25-$50 given BTC 1-year high and low). This is not quite as bad as the fee for an FTX withdrawal ($75), but still pretty steep. So it’d be a good idea to plan your moves carefully with BlockFi.
How long to withdrawals take to hit my bank account?
The official response for ACH (checking transfer) is up to three business days, but I’ve experienced a medium time of 1 to 2 business days with my ACH withdrawals. Wire transfers officially take under 24 hours to clear- I haven’t used this option, but from what I’ve read people usually receive funds the same day.
Do I need to deposit a minimum amount to earn interest on BlockFi?
Nope! Per this press release, BlockFi allows you to deposit any amount of Bitcoin (or other crypto) and begin to earn interest. Given that banks in the US and elsewhere are paying jack s*** for interest, this seems a good deal. Especially since crypto has shown to appreciate after any longer amount of time. Zoom out!
The firm claims to take pride in ensuring security excellence and has implemented both financial and technological measures to protect its accounts. While BlockFi’s interest and lending services may resemble those of a bank, funds maintained on the platform are not protected by the Federal Deposit Insurance Corporation. One of the few crypto exchanges that does offer FDIC insurance on all accounts in Gemini, although its fees are relatively high.
Where BlockFi fails to deliver
In several states, services are restricted: BlockFi has been exposed to a great degree of regulatory scrutiny due to its innovative strategy, which combines parts of the crypto world with services normally provided by banks. Several states have not given it permission to provide all of its services, and other services, such as interest accounts, face further ambiguity in places where they are now permitted. On the user interface front, some crucial information, such as how to terminate your account, is difficult to discover on BlockFi’s website.
Other differences between BlockFi’s interest-earning products and “staking” services offered by certain other exchanges are worth noting. Staking is a method of collecting rewards on certain cryptocurrencies by utilizing them to assist in the verification of transactions on a blockchain network.
Staking is not accessible for Bitcoin and frequently forces you to lock up your cryptocurrency for a specific length of time. You may earn interest on Bitcoin (and other cryptocurrencies) with BlockFi, and you don’t have to lock up your crypto to do so; withdrawals are possible at any moment. The no lock-up period with lending is quite nice.
BlockFi’s loans and interest products may be worth investigating if you’re interested in using your cryptocurrency to generate interest or free up some cash without selling your crypto holdings.
There are other platforms that offer a greater selection or wider availability if you’re looking to buy, sell, and trade a variety of crypto assets without borrowing or earning interest. (See our complete list of the best cryptocurrency exchanges.)
How to do a withdrawal on BlockFi
- Log in and go to your dashboard.
Under accounts, click the panel on the left.
2. Click the withdraw button on the top menu- note that the platform won’t let you withdraw crypto to a regular bank because it’s crypto and not cash.
What you need to do instead is select the asset on the left side (will be bitcoin in this case). You’re brought to your Bitcoin balance. Select the buy/sell button in the middle left.
3. On the enter trade amount pop-up, click over to the sell tab. Enter the currency you’re looking to sell. The pop up gives you the option to enter the amount in either the cryptocurrency units or US dollar amount. If you select crypto, you’ll see the sell maximum pop up on the bottom of the box. Hit that if you’re looking to liquidate all the crypto. Under ‘buy’ select either a stable coin like GUSD or USDC. Select the sell button.
4. Click the withdraw button on the top menu. choose the currency you just bought (stable coin or usd), under select destination choose bank account. Choose ACH transfer, because there are no fees. ACH is slower, but wire transfer fees average $20-$30, which is nuts.
ACH withdraws usually take up to 2 business days- but in my experience if I’ve initiated an ACH in the morning on a business day I’ve often had my funds by evening. Wire transfer are far quicker if you need to money RIGHT NOW. No judgement- we all have emergencies.
Personally I love BlockFi because I see earning interest on my cryptocurrency in a relatively safe space is a good hedge against the volatility and downside of the crypto space. If you’ve been in this game long than a month, you know it’s a wild ride.
I don’t put all my Bitcoin or Ethereum into BlockFi. I think BlockFi is great and secure, but I feel putting all my crypto in one place is bad. I keep some of it on my hardware wallet in case we have a regulatory cyptopocalypse or BlockFi gets hacked. Yes, exchanges do get hacked- a Google search will unfortunately yield many results.
US government regulation is unfortunately a dark cloud over BlockFi. BlockFi doesn’t operate in New York, and just ceased operating in New Jersey. Don’t you think it’s a coincidence that a lot of major investment banks operate that have powerful lobbies in those states? While the music is still playing, I’m definitely holding some of my crypto for lending in BlockFi and earning interest.