BlockFI vs YOP: Which One is Better?
Stocks and cryptocurrencies are not doing so well currently. With such fear in the markets, it is tough to make good investment decisions. But what if you could avoid all this volatility-induced chaos and earn risk-free passive income using your crypto?
Crypto platforms such as BlockFi and YOP Finance are currently offering higher APYs than what your banks would offer. So how do these platforms work? And which one should you choose to make the highest returns in the simplest way possible?
Let’s take a look.
BlockFi vs YOP: Which one is better?
BlockFi offers portfolio-backed loans, interest-bearing accounts, and a cryptocurrency exchange to allow trading. Unlike YOP Finance, BlockFi does not solely focus on providing passive income to its investors. Their interest accounts are similar to what YOP Finance offers but there are a few differences such as:
- Interest rates: BlockFi’s interest rates are of their own and can be farmed by simply depositing the tokens and leaving them for a while. However, YOP’s automated smart contracts constantly move investors’ money from one DeFi protocol to the next in search of the highest interest rates. YOP automatically reinvests its profits instead of just sending them over to a user’s wallet. As a result, YOP can offer up to 65% APYs on BTC, ETH, and stablecoin deposits in comparison to BlockFi which offers only 7% for the same tokens
- Amount of withdrawals: Although BlockFi offers many tokens on which users can earn interest, the protocol limits the number of times investors can withdraw their profits. BlockFi allows just one free withdrawal per month on its cash and crypto interest accounts. Subsequent withdrawals will require 0.00075 BTC ($20–50 USD) for Bitcoin withdrawals and 50 USD for stablecoin (GUSD, USDC) withdrawals. On the other hand, YOP Finance allows its stakers to withdraw any amount of profit at any given time.
- Steps to get started: On YOP Finance, users only need to connect their wallets and stake their tokens. No KYC, signup, or email verification is necessary. Unfortunately, this is not the case with BlockFi. Users cannot get started on any of their services without providing a list of details such as full names, addresses, email confirmations, phone numbers, photos, and identification documents.
- Ease of use: BlockFi’s UI is suitable for intermediate to advanced cryptocurrency users. It is unintuitive and requires some digging to find all the numbers and projected earnings. However, cryptocurrency has to be beginner-friendly to attract new investors from the traditional finance world. That’s what drove YOP to build its protocol with simplicity and inclusivity in mind. Only important pieces of information are mentioned first, in case users want to learn more, the Documentation page is always one click away.
- Inclusivity: BlockFi no longer allows U.S based users to open interest accounts on their platforms. Additionally, BlockFi does not provide services in Cuba, Iran, North Korea, Sudan, Syria, or any other country embargoed by the United States. Passive income enthusiasts who do not wish to lose access to their accounts because of regulations may need to find other platforms.
- Transparency: BlockFi does not give a fulfilling explanation of how it manages to sustain its interest-bearing accounts. Doing your research is required to make better investments. Thus, it is necessary to understand where the interest is coming from. YOP Finance details all its APY calculations on its Documentation page.
How does YOP Finance offer a 65% APY?
YOP stands for Yield Optimization Protocol. Besides yield farming highly profitable protocols in DeFi, YOP allows its users to boost their APY by staking their native $YOP tokens.
Apart from the APY, an overlooked concept might be that yield farming on YOP is considerably cheaper in terms of gas fees. For example, it would cost a fortune in gas fees if you were to stake your tokens on Curve and then wanted to withdraw your tokens to chase a better APY on Aave.
Switching back and forth between protocols is one thing, but regularly reinvesting your profits is another. Luckily, YOP Finance’s yield farming smart contracts do all of this on autopilot so that investors can save on fees and make more returns at the same time.