Investing in cryptocurrencies such as Bitcoin can be a wild ride. Because of the inherent large price swings, investors may find that they’re below their average cost basis for a while. And until the price swings back up above that cost basis, the cryptocurrency investment treads water.
With stock investing, you can still earn dividend income while share prices are down. And with real estate investing, your tenant pays the same rent regardless of how you're property's value fluctuates from month to month. Is there a similar way to earn income on crypto holdings? It turns out that the answer is yes through the use of crypto savings accounts offered by companies like Hodlnaut.
Hodlnaut provides a way for buy and hold cryptocurrency investors to earn interest on their holdings. This is similar to owning a dividend-paying stock. By lending their cryptocurrency holdings to investors trading on margin, long-term investors can earn interest.
These accounts aren't like CDs either — investors can withdraw funds at any time. Keep reading to learn more about how Hodlnaut works and what it has to offer.
- Pays up to 10.5% interest on cryptocurrency holdings
- No minimum deposit or lock-in periods
- Allows you to "swap" between tokens and coins on the platform
Crypto Savings Account
Up to 10.5%
Get $20 free when you deposit at least $1,000
Who Is Hodlnaut?
Hodlnaut is a cryptocurrency lending platform. Its Co-Founder & CEO is Juntao Zhu. Hodlnaut was founded in 2019 and is based in Singapore. It's also part of the Antler portfolio company.
“Traditionally, Bitcoin holders will only be able to profit off-price increments from the asset. At the same time, they’re also looking for ways to improve the return on their assets while waiting for the value to appreciate. That’s why we came up with Hodlnaut," Zhu said in an interview with Antler. "We want to help Bitcoin holders earn interest on their Bitcoin and unlock its full value and the opportunity costs of holding it.'
Holdnaut says that its name is a combination of "HODL" and "Astronaut." Hodl is a slang term that cryptocurrency investors often use for the act of holding on to cryptocurrency rather than selling it. The platform aims to help "hodl-ers" earn consistent income.
What Do They Offer?
Hodlnaut pays interest on cryptocurrency deposits. These deposits are loaned out as margin to cryptocurrency traders. The loans/margin are called cryptocurrency loans. Hodlnaut accepts deposits and pays interest on:
There is no minimum deposit requirement and funds can be withdrawn at any time. Try Holdnaut and get up to $20 free >>>
The annual compounded interest rates that Hodlnaut pays ranges from 6.2% - 10.5%. Here are the current rates for each of the platform's supported coins:
The amount of interest earned depends on a coin’s previous month’s performance and demand. Interest is earned daily and is credited to user accounts every Monday.
Hodlnaut offers digital asset loans to institutional clients. Borrowing amounts start at $50,000. Hodlnaut is the counter-party for Institutional Loans. Terms are open or at least three months. Loan-to-value terms range from 25% to 100%.
The only way to contact Hodlnaut is through email at email@example.com or throught live chat on their website. If you live in the US, you may also have to wait a bit for a response as Holdnaut's business hours are Singapore Time, Mon - Fri 10:00 AM - 7:00 PM.
Are There Any Fees?
There are no fees on deposits. However, Hodlnaut does charge withdrawal fees which vary based on the type of currency you withdraw. As of writing, these fees are:
How Do I Open An Account?
You can visit the Hodlnaut website to open an account. Like other cryptocurrency exchanges, users must complete KYC (know your customer) verification to access all account features. Readers for The College Investor can also get up to $20 free when opening a new account with Holdnaut and depositing at least $1,000.
Is My Money Safe?
Hodlnaut is a Singaporean fintech company and follows Singapore’s financial regulations. In the U.S., deposit accounts come with FDIC protection. There is no such protection offered with Hodlnaut deposits (or SIPC protection either). But remember, no cryptocurrency accounts offer this either.
When it comes to platform security risk, Holdnaut runs on AWS and all traffic is SSL-encrypted. Further, all cryptocurrencies that are held in custody with Hodlnaut are placed in cold storage. It uses no hot wallets whatsoever. They also have a whitelisting feature to ensure that withdrawals only occur to approved addresses.
To mitigate their hacking risk, users can purchase additional insurance with Nexus Mutual. Unfortunately, Holdnaut does not pay for this insurance coverage itself. If you decide to purchase insurance through Nexus Mutual’s Hodlnaut Custody Cover smart contract, the coverage maximum is $6.7 million and the premium is 2.6%.
Is It Worth It?
Earning interest with Hodlnaut is riskier than earning interest in an FDIC-insured deposit account. But for that additional risk, Hodlnaut pays far more. As the company is based in Singapore, U.S. residents will need to be ok with stepping outside of the protections provided by U.S. financial institutions.
Assuming no problems, long-term cryptocurrency investors can do well with Hodlnaut. But if you're not sure that it's right for you, know that there are several alternatives to choose from. Compare crypto savings accounts here >>>
Crypto savings account
Interest Rate On Deposits
Up to 10.5%
Interest Payout Schedule
Weekly, every Monday at 5 PM (GMT +8)
Bitcoin: 0.0005 BTC
100 BTC per day
Fiat Currency Deposits
Only supported between the 5 coins on the platform
Up to $6.5 million of smart contract insurance from Nexus Mutual available at a 2.6% premium
Platform built on secure AWS cloud infrastructure
100% cold storage
Mobile App Availability
Customer Service Phone Number
Customer Service Email
Get $20 free when you deposit at least $1,000
- Interest Rates
- Ease of Use
- Customer Service
- Supported Currencies
- Safety and Security
Hodlnaut is a platform that allows cryptocurrency investors to earn interest on their crypto holdings by lending them to vetted institutions.
- High interest rates on deposits
- No minimum deposit requirement
- Pays out weekly to your wallet
- Deposits can be withdrawn at any time
- Deposits aren’t FDIC-insured
- Rates subject to monthly fluctuation
- Limited customer support
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.