Swyftx exchange has announced that it will start offering its clients interest-bearing yields on more cryptos. This makes it the first Aussie-operated crypto to offer the service.
The new product on Swyftx, which is going by the name Earn, will provide New Zealand and Australian residents the ability to rake revenue on 21 different cryptos, including Bitcoin (BTC), Cardano (ADA), and USD Coin (USDC). According to Swyftx’s CEO, Ryan Parsons, the Earn Feature was among the most competitive in the crypto industry. She added that Earn will allow users to withdraw their assets at any time without paying exit fees and with a minimum notice period.
Parsons added that the fee-free flexibility is the main differentiator between Swyftx and other large crypto exchanges, such as Crypto.com and Binance.
Earn to Offer Variable Interest, Attract a Wide Range of Australians
According to Swyftx, the amount that people can earn is dependent on the underlying asset’s volatility. For large-cap stablecoins like USDT and USDC, the interest rates can be as high as 6.7%. However, mainstay cryptos, such as ETH and BTC, will attract 5.1% in interest. More risk-on assets, such as Polkadot (DOT), will be able to earn as high as 12.7%, while the decentralized finance (DeFi) token, KAKA, is expected to yield up to 25.8% in interest.
The feature will also provide yields on TrueAUD, a stablecoin pegged to the Australian dollar. Swyftx indicates the yields on TAUD will be 5.3% annual percentage yield. Although the earnings on Swyftx will be variable, the exchange will be providing a 7-day notice for changes.
Parsons explains that he anticipates Earn to appeal to many Australian investors. According to a 2021 survey released by Independent Reserve’s Cryptocurrency Index, about 28.8% of Australian adults own cryptos. Parsons added that they anticipate seeing more Australians shifting to crypto wealth services as digital assets become more familiar.
Other Crypto Exchanges Following in Swyftx’s Footsteps
Although Swyftx is the pioneer in offering yields on crypto deposits, others are joining this model. On 17th March, Block Earn, an Australian Fintech company, started offering mainstream direct access to decentralized finance (DeFi).
According to Block Earn’s Co-Founder, Jordan Momtazi, current Australia’s economic status makes products that provide users with yields on savings very attractive. This is very difficult to achieve using traditional financial institutions.
Finder, another Aussie fintech, unveiled its Earn product on 7th March 2022. Using the feature, people who save TAUD on the fintech earn up to 4.0%. The company has also announced a bonus of a 6.0% rate between 1st May and 1st July for all deposits AU$ 10,000 in TAUD into Earn on Finder mobile app.
In Australia, the regulation on yield-bearing crypto deposits is way more relaxed compared to that of the United States. SEC (Securities and Exchange Commission) has taken a hard-line stance on crypto-related lending and interest-bearing assets. In January 2022, SEC started a probe on the lending operations of Voyager Digital, Celsius, and Gemini. Later on, on 14th February 2022, BlockFi was fined USD 100 million for not registering high-yield interest accounts.
