Higher asset risks

Stablecoins carry regulatory risks, which is why you earn much higher interest rates on them with a cryptocurrency exchange. After all, it is a virtual representation of the U.S. Dollar without any legal backing or license. In other words, you get those lucrative stablecoin interest rates in return for this legal risk.

It’s not only stablecoins that have regulatory risks; any cryptocurrency is faced with the same risk including Bitcoin and Ethereum. Possible regulations in the future are posing access risks for the cryptocurrency market.

Regulatory risks

The market has been highly fearful of regulations since the inception of this asset class. This situation is often abused to create FUD (fear, uncertainty, and depression) in the market to shake out the weak hands during market sell-offs.

However, regulations are indeed materializing. The Securities and Exchange Commission (SEC) in the U.S. recently banned the crypto interest accounts of several major cryptocurrency platforms.

Please note that CEX.IO crypto savings accounts are currently not available in the U.S.

Higher interest rates

The rates offered on CEX.IO crypto savings accounts are typically higher compared to the fiat-currency interest rates at banks. This especially includes the U.S. dollar-pegged stablecoins.

On CEX.IO, you could earn up to a whopping 12% interest rate per annum for stablecoins, which is astronomical considering the average 1% savings interest rate for the U.S. Dollar.

It is a common practice for investors around the world to convert their fiat U.S. dollars to stablecoins and benefit from the high interest rates offered on cryptocurrency exchanges. CEX.IO offers the highest interest rate for the Tether (USDT) stablecoin at 12% if you use a Locked Savings interest account , which blocks your funds for a period of your choice (30, 60, 90 days).

This mechanism is similar to a traditional time deposit, like a CD, where you lock up your funds in return for a higher interest rate. If you would generally prefer the highest return rates possible, you can also opt for CEX.IO Staking.

Other than stablecoins, you can earn 4% yearly interest rate for Bitcoin and 6% for Ethereum on a CEX.IO crypto savings account.

Locked Savings

A Locked Savings account on the other hand locks your coins for a specific period just like a traditional time deposit account, like a CD. This means you cannot remove your funds from the savings wallet until maturity. There are three available lockup maturity periods – 30, 60, or 90 days.

Once you transfer funds from your CEX.IO exchange wallet to a Locked Savings wallet, you cannot go back and remove your funds until the unlock date, but in return, you are rewarded with much higher interest rates. For example, with Locked Savings, you could be able to earn 12% APY for the Tether stablecoin, compared to 3% with Flexible Savings.

Funds you transfer to a Locked Savings account are deposited to a locked savings wallet from your exchange wallet, and your interest payouts are disbursed to this locked wallet. You receive your interest payout on the unlock date.

Currently, there are three available lock periods on CEX.IO Savings – 30, 60, or 90 days. Your accrued interest is credited to your savings wallet at the end of the lock period.

During the lock period, you can monitor your accrued interest by clicking on the “Earned” column on the Savings page. The information is updated every day at 6:00 am UTC.

Best APY flexible savings accounts

CEX.IO Savings is the best place to earn interest on crypto. With flexible savings accounts, you earn a highly competitive rate of 3% annual percentage yield (APY) for your stablecoins, compared to an average of 1% APY on traditional USD savings accounts. Stablecoins on which you can earn interest with CEX.IO include Tether (USDT), USD Coin (USDC), TrueUSD (TUSD), and DAI.

Flexible Savings

A Flexible Savings account on CEX.IO does not lock your funds so you can withdraw or sell the tokens in your savings wallet any time you like.

However, you should note that if you move funds out of your Flexible Savings account, you will not be able to receive full interest for the payout period.

Interest payouts in Flexible Savings accounts are credited daily to your savings wallet.

Cryptocurrency tokens that you transfer to a Flexible Savings account remain in an unlocked savings wallet,where your interest payouts are also credited.

You can withdraw or sell the cryptocurrency tokens that you have initially transferred any time you like, in addition to the interest payments thus far.

When you withdraw or sell funds, the system starts with your earned interest. If you want to transfer out a larger amount than your accrued interest, then it withdraws or sells from your principal amount as well.

Highest crypto interest rates with locked savings accounts

If you don’t need the cash flow from daily flexible savings payouts, you can receive better rates with our locked savings product. CEX.IO offers the highest APY for its USDT locked savings account at 12%.

Lucrative rates with locked savings do not end with stablecoins. CEX.IO offers the highest interest rates in the industry for both Bitcoin and Ethereum, at 4% and 6% respectively.