Last Friday, BlockFi, a significant cryptocurrency lending company with headquarters in New Jersey, declared that beginning of July 1, deposit rates would rise for several cryptocurrencies.
The crypto lender announced that it would reduce withdrawal costs for different cryptocurrencies. The business also announced that it would stop allowing one free monthly withdrawal. On July 1, all of these regulations came into force.
In addition to a shifting economic yield environment and dwindling market competition, BlockFi noted that the rationale for the increase in interest rates is its continued mission to provide substantial and long-term customer service while expanding its product offerings.
The cryptocurrency lender announced that starting the following month, the deposit rates for BTC, ETH, USDC, GUSD, PAX, BUSD, and USDT in its BlockFi Interest Account (BIA) would rise. In addition, the company added that starting on July 1, it would also lower withdrawal costs for bitcoin, ethereum, and stablecoins.
Normal market patterns for lending and borrowing assets are used to set interest rates. The new rates will take effect at the beginning of the following month because, according to the corporation, all prices displayed on its rate dashboard are up to date.
BlockFi added that institutional demand for borrowing assets mostly determines the rates on cryptocurrencies held in its BIA accounts.
The company also said that, due to excessive withdrawal demands, it would change its withdrawal structure from July 1 in addition to raising interest rates.
The business announced it would end a rule enabling one free monthly withdrawal for Bitcoin, Ethereum, and stablecoins. Instead, the company added that it would reduce the withdrawal fees for all those assets.
According to BlockFi, it has accepted the new withdrawal structure based on the present downward trend in the market. Accordingly, depending on the asset, consumers must pay transaction fees up to a maximum of $25.
The recent statements by BlockFi came after the lender reduced its workforce by 20% and obtained a $250 million loan from FTX exchange to help its financial situation.
A day after FTX CEO Sam Bankman-Fried promised that the exchange would help other struggling cryptocurrency companies, BlockFi revealed Wednesday that it had secured a $250 million line of credit from the exchange.
BlockFi joined several cryptocurrency companies affected by the recent, severe market decline last week. To survive the current crypto cold, BlockFi made significant employee layoffs.