Bitcoin has offered crypto investors several opportunities that they can utilize to generate additional income. As a result, bitcoin holders are enjoying great returns with a high yield from their Bitcoin assets. This comes at a time with especially now interest rates from traditional bank deposits which have plummeted to lows of 0.5% or less per annum.
Owning Bitcoin comes with several benefits as there are countless ways to benefit from the crypto assets. There are fintech companies that are now more than willing to pay Bitcoin owners an annual percentage return of 6% or more. The concept works by depositing your bitcoins in a bitcoin wallet with interest that can be paid weekly or any period that you choose.
Having a Bitcoin wallet with an interest-paying account now seems to be a wise investment idea considering the current markets for risker conventional investment options such as real estate and stocks have become. Additionally, Bitcoin is one of the most stable cryptocurrencies globally, with its value rising consistently within the past decade, making it a good choice. However, the coin has recorded price falls in the recent past few days in June 2021. All the same, the long-term outlook for Bitcoin remains promising.
In this article, we share everything you need to know about a Bitcoin wallet with interest.
What is a bitcoin wallet with interest?
Put in simple terms, a Bitcoin wallet with interest refers to a crypto wallet where you can hold your bitcoins and earn interest at an agreed rate. It is one of the best ways investors can grow their investments or generate additional income for personal use. All you have to do is create an account, verify your details, deposit some bitcoins and start earning interest immediately.
The prices of cryptocurrencies are highly volatile and their value can rapidly shoot up but they can also crash. However, Bitcoin is the most valuable and most popular digital currency, and as a result, it has experienced relative price stability. In fact, there was a time in December 2017 when a single bitcoin was trading at almost $20,000. Because of this, many Bitcoin holders are not willing to sell their crypto assets and instead prefer to hold onto them.
If you want to earn from Bitcoin and you are not well-versed with the world of crypto trading; this is where a Bitcoin wallet with interest comes in. You can consider various options, but the YouHodler bitcoin wallet with interest is one of the most reputable wallets. After creating your Bitcoin wallet with an interest-paying account at YouHodler, you get an additional multi-coin wallet that supports over 14 other popular digital currencies.
How does a Bitcoin wallet with interest work?
The Bitcoin wallet with interest is the only place where you can hold, multiply and earn from your bitcoins simultaneously. Depending on the provider you choose, you can get paid an APR ranging from 2-12%. For instance, your bitcoins can earn you annual interest of up to 12 % when deposited in a YouHodler Bitcoin wallet with interest.
When you deposit bitcoins to your crypto savings account, you will start earning interest that you can withdraw depending on your financial needs. In addition, you can choose two investment options when you deposit bitcoins to your wallet — the flexible savings option and the fixed savings option.
The flexible savings option
With this option, you deposit bitcoins to your bitcoin wallet with an interest-paying account, earn interest, and redeem the interest or the entire investment at your convenience. You can withdraw your interest weekly and have the funds instantly deposited into your account.
The bitcoins deposited in the flexible savings account can be accessed at any time. Interest earned is calculated daily. This is a great option to choose if you might need to redeem your crypto assets in the near future.
The fixed savings option
While the yield obtained from this type of investment is better when compared to the flexible options, you lack the flexibility to access your investment at any time. When you go for this option, you will have to choose a specific period over which you will deposit your bitcoins, and during this time, you will earn interest which is also compounded.
This is the best way to grow your investment because of its better rate of return. If you have no immediate need of cash now or in the foreseeable future, this is the option you should go for. After the selected period has lapsed, you can redeem your investment or even decide to reinvest.
Is a Bitcoin wallet with interest secure?
Any transaction that is done online comes with several risks. That is why you are advised to choose reputable wallets such as YouHodler whose providers have taken strict measures to ensure that investor assets are protected.
You can tell if a wallet or trading platform is reputable by looking at the daily transaction volumes. This is an indicator that many investors trust the platform to keep their assets safe. In addition to enacting strict security measures, some platforms have taken the option of securing insurance coverage to protect their investors’ assets.
What are the risks involved when using a Bitcoin wallet with interest?
One common trait that describes cryptocurrencies is that they are highly volatile, which can be a major risk. You invest in Bitcoin, meaning returns will also be paid in bitcoins. In the case of a drop in value, there is a chance of losing your initial investment plus the returns earned.
Additionally, when depositing your bitcoins to a Bitcoin wallet with interest, you must give up your access to your keys. This is because your crypto must be available to be lent to other investors from which you will be earning interest. This means that there is a chance of losing your assets, especially if you choose a Bitcoin wallet with interest that is not insured.
Is a bitcoin wallet with interest worth it?
The truth is an investment in a Bitcoin wallet with interest accounts is not as safe as conventional options such as bank deposits. The investment is riskier but on the other hand, the reward is much greater. If you come to think about it, a Bitcoin wallet with interest is worth it as is almost impossible to find an alternative investment option where you can earn up to 12% APR on your savings. So, take your time to browse the various options open to you and choose a secure platform with attractive terms that meets your needs.