Crypto.com — A Second Chance. From Blockfi, to Crypto.com to Fulcrum…
Tags: Defi, Cryptocurrency Investment, Blockfi, Fulcrum, Cryptocurrency

From Blockfi, to Crypto.com to Fulcrum: the search continues for high yield…

Chasing yield can lead you places

Not sure if it was the tweet about my article “Switching to Crypto.com from Blockfi, A Misadventure” that did it, but after 8 days Crypto.com finally got things squared away, and I started earning interest.

All of the BTC and USDC funds that I had on Crypto.com and moved to Blockfi now had to be moved back to Crypto.com.

Blockfi has a 48 hr wait on transferring funds, which is at least better than the Crypto.com withdrawal confirmation email that never arrived I experienced previously with Crypto.com.

But I was willing to give Crypto.com a second chance.

Call me a sucker, call me a yield chaser, but I have to admit that even with the trials and tribulations of my various transfers and blocked transfers, and lack of timely support, that 10–12% APR is a siren’s song seducing yield chasers toward shore.

But any reader of the Illiad knows how that one turned out…

48 hour waiting period. A 10 day round robin. Their excuse is because they were experiencing unusually high demand. That, combined with a possible reduction in workforce due to Covid leads me to cut them a little slack. They say in sales that some of your best customers were people who had a bad experience that you are able to turn around and make right.

We’ll see if that turns out to be the case.

3 Months later…

Okay, the thing about Crypto.com is that in order to receive their relatively high interest rate, you are required to lock up your money, with the highest rates applied after a 3 month lockup.

Kinda like a CD.

Long story short, once the “Earn” button showed up, I was able to deposit my USDC, and after 3 months I received 3 months worth of a 10% APY on my deposit.

…and promptly withdrew all of it.

Why? Two reasons…

Locking up coins for 3 months is something I am hesitant to do in a fast moving market, even with stablecoins. Not being able to access my cash when the market is pumping seems like a big negative for Crypto.com. And while the interest rate at Blockfi is only 8.6% for USDC, at least you are able to withdraw the money at any time.

The second reason is that I found a better rate. A much better rate.

Where?

Welcome to Fulcrum

The past 2 weeks I’ve been enjoying the APR at the bzx driven app Fulcrum.

The rates for USDC, Dai, and USDT the past 2 weeks have fluctuated between 84% and 29% APR — far beyond anything I ever received from either Blockfi, or Crypto.com.

As far as I can tell, the interest is continuously compounding, meaning that one doesn’t have to wait until 30 days have passed before the amount is compounded, the interest is compounded at that moment, from second to second.

Which makes sense as the interest fluctuates based on demand.

The Process

The process, once you have done it once, is straightforward, especially when compared with Blockfi and Crypto.com. Connect the Fulcrum app with a supported Ethereum wallet (I used MetaMask which is connected to MyEtherWallet), and start lending. Once you grant access to Fulcrum, you can see the interest start to pile up.

The high interest of 84% I received was during the hack that Fulcrum experienced of $8 million dollars (which they quickly were able to claw back). Since the interest is shared between participants, I believe that the rate increased as weaker lenders left the platform, allowing the remaining interest to be shared among a smaller pool of participants.

For whatever reason I was less concerned about the hack, perhaps because during a previous hack the platformed assured that no user funds would suffer, and everyone would be made whole.

Also, they were able to retrieve the latest $8 million that was hacked by the following day.

I continued to lend my stablecoin funds on Fulcrum, and continue to this day.

Stacking Sats

What methods you use to stack sats are your business, but it may give you some ideas to consider knowing what I do. Half my funds I keep in stablecoins, splitting between USDC, USDT, and DAI, which I lend to Fulcrum, earning anywhere from 30–84% APR. The reason I split it up this way is because the interest rates for these USD equivalents fluctuates, with one coin in the lead versus another.

The other portion is in BTC, which I place in Blockfi. The APR I receive from there simply stacks more BTC every 1st of the month.

Every 3 months or so I “Unlend” a portion of my interest earned on Fulcrum, and purchase BTC.

This way, I benefit from the high interest earned in Stabledollar terms (on Fulcrum), as well as on the hoped-for rise in BTC price.

Backup Plan

I don’t keep all of my BTC on Blockfi, nor all of my dollars on Fulcrum. As we’ve seen with the latest regulatory attacks on Bitmex, as well as the various hack-of-the-day, keeping funds on a centralized platform can be a risk. And even as decentralized as bzx is trying to make Fulcrum, dangers exist there as well, from the sneaky defi “arbitrage” to even more straighforward hacks.

Keeping some crypto and dollars secured off-exchange is a way to secure funds when SHTF, while still benefitting from the insane interest one can get on Defi.