$$$ KPO and CZM $$$: Earning High Interest Using BlockFi and Celsius Network Part 2

Saturday, April 3, 2021

Earning High Interest Using BlockFi and Celsius Network Part 2

You can read about Part 1 here where I shared how to transfer money to BlockFi and Celsius Network without incurring additional fees to earn high interest. As mentioned previously, we will be pumping more money into Celsius Network to arbitrage USD. It took some time because I had to get my RM to provision/setup a new USD overdraft/leverage account. You can read about how we have been using leverage here. This means I will be borrowing and transferring USD to these platforms without a single cent and essentially removing FX risk too :)

In total, I transferred US$30k to BlockFi and the interest incurred while borrowing the USD for those few days was around US$3.33.


If you are wondering why I transferred US$10k on 3 different days, it is due to the transaction limit imposed by the bank. For international fund transfers, the daily maximum amount is just SG$20k.


Let's take a look at BlockFi's transactions.


The interest I earned from BlockFi for those few days was US$20.75! Look at the difference! Not forgetting the interest in BlockFi is actually lower at 8.6%. The plan/arbitrage opportunity is to borrow USD at 1-2% and earn 10+% through Celsius Network. 

As mentioned in my previous article, BlockFi provides one free withdrawal on a monthly basis and because I had already transferred US$200 in March to test it out, I had to wait for a new calendar month before I can make another withdrawal for free. Some of my readers didn't understand the previous article so I shall take more screenshots and explain it step by step.


In BlockFi, click on "Withdraw".


Select "Cryptocurrency Wallet".


Enter the amount you would like to withdraw. I am withdrawing US$29,800 because I already have US$200 with Celsius from last month.


Select "+ New wallet address". Now you open your Celsius Network app and select GUSD.


Click on "Transfer".


Read the warning/disclaimer. Like I mentioned previously, you must make sure you are sending your money/crypto to the correct wallet address. Otherwise, they will simply disappear into thin air with no way of reversing the transfer!


Copy the address. Do not even try typing it out. lol.


Paste it in. I will double-check the address and ensure that it is correct.


I will double-check the address again and as you can see, there is no transfer fee/it has been waived.


I will triple-check the address. lol. The good thing about BlockFi withdrawal is that it will hold and delay the transfer by one day so if you realized that you have transferred to the wrong address or a transfer was not initiated by you, there will still be time to cancel it. 


Now my USD is earning an interest of 10.51%! In addition, Celsius Network credits the interests on a weekly basis (every Monday), hence allowing compounding to take effect sooner! In my opinion, this way of leveraging is even safer than buying stocks because there is no risk volatility on my capital. Simply, earning higher interest to pay off the interest incurred and keeping the difference!

Stay tuned to the next update which should be about 1 month later where we can take a look at the interests for the whole month from both the borrowing and the deposit :)

If you are interested in the platform I am using, do sign up using our referral links for some bonus :)
BlockFi: Deposits US$100 or more into your BlockFi Interest Account (BIA), you will earn US$10 in BTC and we will earn US$10 in BTC too.
Celsius Network: Earn US$40 in BTC with your first transfer of US$400 or more and we will earn US$40 in BTC too.

On a side note, Futu's moomoo attractive sign-up bonus (one free Apple Share besides other benefits) has been extended to 30th April 2021 (1500hr SGT)! Take a look at our review here.

You might be interested in these articles too:
Earning High Interest Using BlockFi and Celsius Network

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18 comments:

  1. The article states that all the interest earned will be in GUSD coins. In that case, how do you intend to convert the GUSD coins back to actual USD ?

    ReplyDelete
    Replies
    1. When you transfer GUSD to Gemini exchange, it will be recognized as actual USD

      Delete
    2. Hi b1ah,

      Like Unknown mentioned, GUSD is recognized as USD in Gemini exchange. Based on my conversation with a reader and Suz from https://suzmoneylife.com, the most cost effective way is to transfer to Gemini and wire the USD out to the bank account. This way, there will only be a SG$10 inward TT fee for DBS - https://www.dbs.com.sg/personal/support/bank-overseas-funds-transfer-fees-and-charges.html. Wiring USD out from BlockFi might incur US$30 for TT transfer.

      Of course, I have yet to test these myself and cannot confirm the accuracy for now.

      Delete
  2. Very nice articles on part 1 and 2 on earning High Interest Using BlockFi and Celsius Network. Pretty straightforward for layman to understand and thanks for sharing. And similar to the question asked by b1ah, how do you eventually move the money in Celsius Network (GUSD stablecoins) back to your standchart USD account?

    Celsius Network (GUSD) --> BlockFi (one free crypto withdrawal per calendar month) --> standchart USD account?

    Thanks.

    ReplyDelete
    Replies
    1. Hi Nightmare_Angel,

      Thanks! The plan (in theory) is to do it this way:
      Celsius Network (GUSD) --> Gemini Exchange (USD) --> DBS/SC USD account

      It seems that SC charges a higher fees for inward TT while DBS is charging a flat SG$10. Like I mentioned above, I have yet to test it out so cannot confirm for now and I don't plan on doing it soon. Will probably do it like once a year due to the fees/cost involved.

      Delete
  3. This comment has been removed by the author.

    ReplyDelete
    Replies
    1. Hi Pipping Cafe,

      Yes, everything still looks quite complicated but I am testing/reading up now.

      Delete
  4. btw, i notice that for BlockFi, one actually need to pay $30 to withdraw using wire transfer. Free one time withdrawal per month is only for crypto currencies

    ReplyDelete
    Replies
    1. Hi lulu_loves_be@rbrick,

      Yes, I was referring to the crypto for free withdrawal. It was stated clearly in the first/previous article - 1 free withdrawal for stablecoin and 1 for non-stablecoin (BTC, ETH, etc.) per calendar month.

      To convert back to fiat/wire, do it through Gemini Exchange although that have not been tested too. Refer to my comment above - Celsius Network (GUSD) --> Gemini Exchange (USD) --> DBS/SC USD account

      Delete
  5. Hi KPO,

    Thanks for the post! Noted on your method of Bank --wire transfer (no fee)--> BlockFi --transfer (no fee)--> Celsius Network (interest ~10.5%).

    If I wanted to put GUSD in Celsius, is there any reason not to transfer the GUSD directly from Gemini to Celsius (i.e. bypass BlockFi)?

    Cheers.

    ReplyDelete
    Replies
    1. Hi Gareth,

      There isn't! When I first came across such interest account, I did not have Gemini setup. Only had accounts with Crypto.com, Luno and Binance, all of which had some fees for withdrawal so I was happy with BlockFi free transfer. However, I have just checked on Gemini (https://www.gemini.com/fees/transfer-fee-schedule#section-withdrawal-fees-individual-customers), there isn't any fees so it does make sense to transfer directly from Gemini.

      Thanks for pointing this out!

      Delete
  6. Interesting read on Celsius, do update again once you gotten the interest

    ReplyDelete
    Replies
    1. Hi Alan,

      Sure! Interest is paid out on a weekly basis, so I have received US$53.78 already for the first week! I will blog about more it next month, do drop by again :)

      Delete
  7. I have signed up BlockFi using your referer code but can't get pass the KYC process :(

    Anyway, for funds transfered into BlockFi did it automatically deposit as GUSD? I notice that USDT has a higher interest rate...

    ReplyDelete
    Replies
    1. Hi Alan,

      Thanks for using my referral code! Are you referring to the face tilt left and right one? I remember I had some difficulty too but just got to keep trying? lol.

      Yes, the USD that were transferred into BlockFi is automatically converted to GUSD. I guess you are referring to the USDT interest within BlockFi? Did you check out Celsius Network? That's why my strategy is to transfer to Celsius because the interest for stablecoins are even higher than BlockFi.

      Anyway, USDT isn't backed 1:1 entirely with USD and is slightly controversial - https://en.wikipedia.org/wiki/Tether_(cryptocurrency). Personally, I prefer holding GUSD or USDC which is backed by USD 1:1 for longer term.

      Delete
    2. BlockFi support said my IC was expired hence system is unable to complete the KYC...

      I will try Celsius with yr referral later.. I also see that Gemini has free withdrawal features... I can withdraw directly to Celsius directly when the time comes!

      Delete
    3. Btw, u have referal for Gemini?? :)

      Delete
    4. That's odd, maybe try other form of documents like passport? Passport has a new purpose now given that we can't travel during this period. lol.

      Yes. If you don't plan to deposit BTC/ETH with BlockFi then you can skip it. Just withdraw from Gemini. Haha.

      Gemini Referral: gemini.com/share/y6mxgmefy

      Thanks once again for using my referral!

      Delete