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BlockFi Cuts Interest Rates On Ether Deposits

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The Cryptocurrency asset management startup BlockFi said it is reducing the interest rate it offers on ether (ETH) deposits to 3.25 percent annual percentage yield (APY) from the current rate of 6.2 percent.

The interest rate is being slashed by nearly half for customers with 25-100 ETH balances in their BlockFi Interest Account (BIA).

Those holding more than 100 ETH balances will be eligible for just 0.2 percent APY.

At the same time, bitcoin (BTC) interest rate will increase slightly. Balances above 25 BTC will earn 2.15 percent interest. The previous interest rate was 2 percent.

Interest rate for all accounts having balances between 0.5 BTC and 25 BTC will continue to remain at 6.2 percent APY.

The new rates will come into effect on June 1.

In a monthly update, BlockFi cited the reason for making rate adjustments to BIA accounts.

While the Bitcoin borrowing and lending markets have been growing, the Ether lending market over the last couple of quarters has become stagnant. According to the first-quarter report published by Genesis Capital last month, just 3 percent of their overall loan portfolio is in ETH. And platforms like Poloniex and Compound are offering borrowing rates on ETH as low at 0.01 percent.

BlockFi also announced some updates to the BlockFi dashboard. These include the ability to view the value of depositors' account balance in US Dollar, the total amount of interest they have earned to date, calculators that forecast future potential interest earned on their balance, and withdrawal submission in the BIA dashboard.

The New York-based crypto financial services provider, which offers USD loans to crypto asset owners, said the BlockFi Interest Account now has total assets worth more than $100 million.

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