On Thursday (December 5), FinTech startup BlockFi, which is a well-known player in the blockchain space because of its crypto interest accounts (BTC, ETH, and GUSD) and crypto-backed USD loans, announced the launch of “BlockFi Trading”, its new crypto trading platform.

A Brief History of BlockFi

BlockFi, which is based in New Jersey, United States, was founded in July 2017 by Zac Prince (CEO) and Flori Marquez (VP of Growth), and it got launched in August 2017.

Among others, it is backed by ConsenSys Ventures, Fidelity subsidiary Devonshire Investors, Morgan Creek Digital, and Mike Novogratz’s Galaxy Digital. 

In April 2018, BlockFi started offering USD loans collateralized by your cryptoassets (Bitcoin and Ether). Roughly six months later, it expanded the range of cryptoassets that it accepts as collateral to Litecoin and stablecoin Gemini dollar (GUSD).

Then on 4 March 2019, BlockFi launched the BlockFi Interest Account (BIA):

… users can securely store their Bitcoin or Ether at BlockFi and receive 6% annual interest, paid monthly in cryptocurrency. Interest earned in a BIA compounds monthly, delivering an industry-leading APY of 6.2%. The program has been in private beta since the beginning of 2019 and already holds over $10 million in assets from retail, corporate, and institutional crypto investors.

At the time, BlockFi CEO Zac Prince made the following comment:

The launch of BIA is another significant step in BlockFi’s goal of becoming the go-to provider of financial services for crypto investors. Lending and borrowing is readily available at the institutional level, and we’re excited to leverage our relationships and capital markets expertise to provide utility and yield on digital assets for all crypto investors.

The company also said that the BlockFi Interest Account “is available to customers worldwide,”and that “client assets are custodied at Gemini Trust Company.”

BlockFi said that this product offered the following advantages over competitors:

  • compound interest;
  • institutional backing;
  • interest paid monthly in crypto (i.e. in BTC if you have a Bitcoin interest account and in ETH if you have an Ether interest account); and
  • no-notice withdrawals.

Here is a table from BlockFi’s website that shows how the BlockFi Interest Account compares to its competitors:

BIA Features Table.png

Although the BlockFi Interest Account was initially launched with support for only Bitcoin and Ether, on 29 May 2019, BlockFi announced “support for Gemini Dollar (GUSD) stablecoin throughout its platform.” BlockFi said back then that this meant two things:

  • BlockFi Interest Account (BIA) clients based outside the United States could now “earn up to 6.2% APY, earned monthly in GUSD.”
  • GUSD became available “as a USD loan funding option and as collateral from institutional crypto borrowers.” 

BlockFi’s New Crypto Trading Platform

According to a press released shared with CryptoGlobe, today marks the launch of BlockFi Trading, the company’s new cryptocurrency trading platform, which makes it easier for BlockFi’s individual/retail and institutional clients to “manage their crypto-assets and optimize their asset allocation.”

More specifically, BlockFi Trading allows anyone who is registered on the BlockFi website (i.e. even people who are not existing users of BlockFi’s other products/services) to easily and quickly convert between BTC, ETH, and GUSD without paying any fees:

BlockFi Trading - Conversion between BTC and ETH.png

BlockFi Founder and CEO Zac Prince had this to say about today’s launch of BlockFi Trading:

To date, we have focused on providing products to existing crypto investors that are readily available to investors in other asset classes. With the launch of trading, we are taking a big step in the direction of enabling net new investors to come into the ecosystem. Growth of the crypto market overall benefits the entire industry and we’re excited to shift our focus in that direction, in addition to adding products and features that expand the value proposition for our existing clients.

To satisfy Bank Secrecy Act (BSA) regulations in the U.S., BlockFi is registered with Financial Crimes Enforcement Network (FinCEN) as a Money Service Business (MSB), and “has expanded their state licensing strategy to include money transmission licenses in addition to its existing state lending licenses.”

All Images Courtesy of BlockFi