Difference between Gemini and BlockFi

Difference between Gemini Vs BlockFi

Let’s know about Gemini

Gemini is a leading platform through which the user can buy, sell and lend their crypto and earn interest on their lending. Gemini was founded in April 2014 in New York, USA. It was founded by Winklevoss Twins – Tyler Winklevoss and Cameron Winklevoss. The Chief Executive Officer (CEO) of Gemini is Tyler Winklevoss and the Chief Operation Officer (COO) of Gemini is Noah Perlman. Its headquarter is located in New York, USA.

The interest on your lending is distributed every day and also on an annual basis which is termed APY (Annual Percentage Yield). The currency in which you’ll receive your interest rewards will be the same currency you have deposited. Example: If you have deposited Bitcoin over Gemini then the rewards or the interest you’ll receive will be also in terms of Bitcoins.

Gemini allows you to earn yields on different cryptocurrencies. You need to deposit your cryptocurrency in Gemini Wallet once you do that you can see that you earn interest every day.

Gemini is regulated by the New York State Department of Financial Services (NYSDFS). Gemini operates within the standards set by NYSDFS. It includes standards of Cybersecurity and Reserve Requirements.

Few Products by Gemini include Gemini, Gemini Earn, Gemini Credit Card, Gemini Custody, Gemini Wallet, and Gemini Pay. Gemini App is available on Google Play Store and Apple App Store.

Let’s know about BlockFi

BlockFi is a secured, non-bank lender that lends loans to cryptocurrency and digital asset holders. BlockFi holds users’ Bitcoins and Ethereum and issues loans in USD directly into their bank account. BlockFi was founded in August 2017 in New Jersey, USA. It was founded by Zac Prince and Flori Marquez. BlockFi has its Chief Executive Officer (CEO) Zac Prince. It has its headquarters located in Canada.

BlockFi is the easiest way to buy, sell, trade, store and earn your cryptocurrencies. BlockFi provides one step for all your crypto needs. It works under many blockchains that offer transparent and flawless operations and they are planning to expand its organization to fulfill the needs of both institutions and individuals.

Using BlockFi one can earn interest on their deposits. However, unlike Gemini BlockFi offers flexible interest rewards. That means instead of receiving the rewards in the same cryptocurrency as you deposited you can manually select the currency in which you want to receive your interest rewards. For example: if you deposited Bitcoin but want your interest rates in terms of Ethereum you can manually select that, so you’ll earn more Ethereum by investing more Bitcoins.

BlockFi has a tier system, that tier system offers different interest rates for different coins at different tiers. All of the BlockFi products are integrated and can be used simultaneously which is not the case with Gemini.

Few Products of BlockFi may include BlockFi wallet, BlockFi Credit Card, and BlockFi trading accounts. BlockFi app can be downloaded on iOS and Android through Google Play Store and Apple App Store.

Interest rates offered by Gemini and BlockFi (June 7, 2022)

Both platforms are well known for their unique ability to offer interest on your deposits. But the question is which platform offers the better interest rates?

Listed below are the interest rates offered by Gemini on the deposition of mentioned coins :

  1. Bitcoin – 1.01 % APY
  2. Ethereum –  1.26% APY
  3. Litecoin – 1.51 % APY
  4. Dogecoin – 1.01% APY
  5. Gemini Dollar – 6.9% APY
  6. USD Coin – 5.31% APY

In comparison, listed below are the interest rates offered by BlockFi on the deposition of mentioned coins :

BlockFi doesn’t offer universal interest rates throughout the deposition of coins, the interest rates on BlockFi vary according to the volume of coins you deposit. Therefore, BlockFi has 3 tier system which offers different interest rates for different coins for different volumes of deposition.

Tier 1

  1. Bitcoin – 3% APY (0 – 0.10 BTC)
  2. Ethereum – 3% APY (0 – 1.5 ETH)
  3. Litecoin – 2% APY (0- 20 LTC)
  4. Dogecoin – 2% APY (No limit)
  5. Gemini Dollar – 7% APY (0 – 20000 GUSD)
  6. USD Coin – 7% APY (0-20000 USDC)

Tier 2

  1. Bitcoin – 1% APY (0.10 – 0.35 BTC)
  2. Ethereum – 1.50% APY (1.5 – 5 ETH)
  3. Litecoin – 1% APY (>20 – 100 LTC)
  4. Dogecoin – 2% APY (No limit)
  5. Gemini Dollar – 5% APY(20000 – 2000000 GUSD)
  6. USD Coin – 5% APY (20000 – 2000000 USDC)

Tier 3

  1. Bitcoin – 0.10% APY (> 0.35 BTC)
  2. Ethereum – 0.25% APY (>5 ETH)
  3. Litecoin – 0.10% (>100 LTC)
  4. Dogecoin –  2% APY (No limit)
  5. Gemini Dollar – 4% APY (>2000000 GUSD)
  6. USD Coin –   4% APY (>2000000 USDC)

The annual percentage yield in BlockFi keeps decreasing with the increase in the number of coins.

After comparison, we can see that depositing a short volume of coins is more beneficial in BlockFi whereas if you want to deposit a large number of coins then Gemini will be best.

One could also follow the strategy where one can initially deposit coins in BlockFi to avail of the benefits of tier 1 because the APY of tier 1 is higher than the APY offered by Gemini and after some time they can deposit a large portion of their coins on Gemini to avail the benefits of Gemini because APY offered by Gemini is greater than the APY offered by BlockFi tier 2 and tier 3. In this way, one can get the best of both worlds.

Difference between Gemini Vs BlockFi

  • Withdrawals allowed

In BlockFi you can only withdraw your deposits twice per month for free, if you’ll withdraw your deposits more than twice then extra transaction fees will be charged. Whereas in Gemini you get the benefit to withdraw your deposits ten times per month for free without any transaction fees.

  • Trading Fees

If you use BlockFi for trading, the trading fees that BlockFi asks for are 1.1% of your total transaction. However, in Gemini, the trading fees are down to 0.1% of the total transaction saving more of your penny.

  • Availability of coins

The coins available for trading and depositing are more on Gemini than on BlockFi. This gives users more choice and flexibility to choose the coins that suit their needs.

  • Better Interest Rates on high volume

 As discussed above, Gemini offers better interest rates when you deposit coins in abundance. The interest rates that tier 2 and 3 of BlockFi offer are much lower than that of Gemini which cancels the probability of more profit for you. If you want to deposit your coins in high volume, then Gemini is best suited as the return will be much larger as compared to BlockFi.

  • Flexible interest rewards

BlockFi offers its users the freedom to avail their interest in their own preferred currency. If you’ve deposited Bitcoins but you want your interest in Ethereum or any other currency other than bitcoin or even bitcoin it can be possible through BlockFi. It is not necessary that you can only receive the interest in the same currency as you deposited. However, in Gemini this is not possible, you’ll receive your interest in the same currency as you deposited.

  • Faster Trading

BlockFi is an integrated platform along with all of its products. The wallet where you receive your interest is the same wallet through which you can exchange and perform trading. In this way, BlockFi gives you the ability to receive interests and trade your coins simultaneously. For example: if you have 10000 USDC and you want to convert that to bitcoin you can easily do that without the need to withdraw your deposits.

But, in Gemini, the Gemini Earn and Gemini exchange are two different platforms, so if you want to trade your deposits you firstly need to withdraw your deposits from Gemini Earn and then trade it on the Gemini exchange which is manually a long process. There is also a 5 days lockup period throughout the process which makes this system slow and more time-consuming.

However, the trading fees over Gemini are 0.1% and on BlockFi is 1%. So it depends on one’s preference if they want to give 1% trading fees for a fast process or want to save more.

  • Better Interest Rates for low volumes

BlockFi may not offer high interest for a high volume of coins but if you’re the one who deposits the coins in short quantity then BlockFi will prove best. The BlockFi at tier 1 offers far better interest rates than Gemini, which gives you more profit.

In conclusion, both Gemini and BlockFi outstand each other in different aspects and it’s always the need of the user that makes any platform useful for him/her. If anyone who prefers to deposit coins in large quantities should prefer Gemini over BlockFi. Whereas if you want an integrated platform to solve all your problems concerning crypto then one should prefer BlockFi.