Having a bank savings account has been a standard to store our money safely for the longest time.  However, the big issue is that most banks offer less than 1% interest on the deposited funds. After taxes, it is even less than that. For years, Institutions and Individuals have been longing to find an alternative, a place where you could deposit your excess funds while having the flexibility of being able to withdraw it whenever you like. Moreover and perhaps the most sought after, earning more than the conventional “rate” the banks offer.

The Birth of Cryptocurrency Savings Protocols

The concern, as mentioned above, is precisely what the Crypto Savings Accounts try to address and cater to. An ‘attractive” return for your deposited funds. How do crypto savings accounts stack up? Below are some of the most prominent savings protocols available with their “promised” rates.

BlockFi (A dedicated Cryptocurrency Savings Account)

BlockFi is a crypto custodian founded in 2017 and has just landed $350 million in funding last year, in March of 2021. The company is currently pegged at a $3 billion valuation. Since its inception, the platform has exploded in growth and currently offers retail and institutional-facing products. BlockFi offers up to 7.25% APY (annual percentage yield) on Stablecoins (such as USDC), 4.0% APY on bitcoin, and 4.0% APY on Ethereum.

1. Binance’ Flexible Savings

Binance has been one of the most popular and currently one of the biggest cryptocurrency exchanges, with over 500 tradable crypto assets. Its “Binance Flexible Savings” is an active crypto savings account that lets you deposit your funds and cryptocurrencies to earn significant interest while also allowing you to withdraw them at any time. Furthermore, Binance Flexible Savings offers up to 10% APY (annual percentage yield) and up to 20% APY for cryptocurrencies.

2. Coinbase’s Savings Account

Coinbase is perhaps the most secured cryptocurrency exchange in the world, and it has never been hacked since its inception. On top of that, together with Binance, it is also one of the biggest and most famous cryptocurrency exchanges. It offers one of the lowest rates. However, it still topped most banks’ savings accounts. You can earn up to 4% APY on your deposited US dollars on the platform.

3. Crypto.com’s Savings

Crypto.com currently offers more than 250 cryptocurrencies to its over 10 million customers worldwide. In addition, Crypto.com serves users in more than 90 countries with cryptocurrency-related financial products. The company’s savings account offers up to 15% APY (annual percentage yield) and up to 14.5% APY for cryptocurrencies.

Final Thoughts

The rates are indeed attractive, and some even offer higher returns than the historical gain of the US Stock Market. However, the concern and perhaps a valid caveat is that these are relatively new products. Unlike US banking savings accounts, they are less regulated by the Government and, unlike bank deposits which are guaranteed by the Federal Deposit Insurance Corporation (FDIC), any deposit guarantee does not cover crypto savings accounts. Nevertheless, it is remarkable that these savings accounts now exist and provide an alternative to traditional savings account products. Now more than ever, we have more options on where to put our excess funds.