Today’s blog post is going to resume with what I usually do – giving reviews of products and services that I personally use. A recurring theme or tagline that I tend to use on my blog is “skin in the game” – I don’t typically share about stuff that I don’t use, which explains today’s appearance of Hodlnaut review of its platform.
This is also why I don’t write about Moomoo or Tiger (OK, not yet, maybe never) despite their extremely profitable referral fees.
I gotta say, you guys sure loved the last blog post. We all enjoy a “good” market crash, right? It sure made for a huge spike in blog traffic.
Even though my last blog post was a little leaning on the doom and gloom side of things, the opportunistic amongst you dug a little about the platforms that I was using for my USD stablecoins. It could be a decent all-weather market strategy to HODL for interest payments regardless of price movements.
Seeing how I have a non-trivial amount on the Hodlnaut platform, I hope to provide a little more value and insight into the Hodlnaut platform in this blog post.
In case you missed it – all the referral codes and links that benefit you have always been sitting in the Shop & Referral Codes section of my blog.
When it comes to crypto, knowing all about the tools and options at our disposal is very important. Otherwise, it would be like going to a fight with our arms tied behind our back.
Let’s get started!
What is Hodlnaut?
Lifted directly from Hodlnaut’s official website, Hodlnaut is a platform that provides financial services for individual investors (that’s you and me) where they earn interest on their cryptocurrencies by lending it to corporate borrowers, who would otherwise struggle to access crypto loans.
Important to note that Hodlnaut is an Antler portfolio company, which is a company (public or private) that a venture capital firm, buyout firm, or holding company owns equity. In other words, companies that private equity firms hold an interest in are considered portfolio companies.
At the moment, Hodlnaut has over 5,000 users and is managing over US$250 million – almost 100 times that of last year’s figures.
Is Hodlnaut safe?
The number one concern on everyone’s mind when reading a Hodlnaut review, where is the part that talks about safety?! Is my money and crypto safe?
In Hodlnaut’s co-founder, Juntao’s own words –
“Other than offering the best rates, we are based in Singapore, and we are a full Singaporean team. Our customers and users can be assured that they can reach out to us anytime and we are fully compliant with any regulatory requirement by the Monetary Authority of Singapore (MAS).”
We also have to contend with platform risk, as always, for anything we use. You have to understand that for such an online platform, there will exist cold storage (not connected to internet) and hot wallet (connected to internet) because of the need to facilitate transactions.
Insurance such as BitGo for custodian platforms typically covers over the cold storage aspect only.
To complement cold-storage insurance, platforms typically will need to put aside a portion of their profit to establish a “self-insurance” fund if things go south due to exploits etc, which is what Hodlnaut is doing as well.
In addition, Hodlnaut is also partnering with Nexus Mutual, a third-party insurance provider to allow users to buy their own insurance. See Hodlnaut’s official guide here. A little clunky for novice users, though.
Props to the Hodlnaut platform for being open and transparent on this because this isn’t an area that most alternative platforms are willing to share on. Also, Hodlnaut will be working with iTrust in the near future to integrate the purchasing of Hodlnaut Custody Cover directly on the Hodlnaut platform.
Update [21-Jun-2021] I’m in the Hodlnaut Discord server and I’m hoping to be able to have the iTrust option available for a simpler way to obtain insurance for our assets.
Hodlnaut is also using enterprise-grade platform, Fireblocks, to provide fast and secure infrastructure for its asset management and has also initiated an independent, third-party second verification of its assets by Crowe Singapore, a global audit firm.
These are just a series of steps undertaken by Hodlnaut meant to strengthen the safety and security aspect of their business. Yes, they mean business and aren’t a fly-by-night outfit.
What is the current Hodlnaut interest rate
I have been using cash management solutions such as Singlife, Syfe Cash+ and Endowus Cash Smart for quite a while.
Just like you, I complained when the rates dropped amidst the worsening global conditions.
In the alternate crypto universe, activities were ramping up since 2020 and interest rates have since gone up on Hodlnaut’s platform.
What is a Hodlnaut review without talking about interest rates, right? (updated 4th Aug 2021)
The image above also corresponds to the six types of accepted tokens for deposits – Bitcoin (BTC), Wrapped BTC (WBTC), Ethereum (ETH), DAI, USDC and USDT – with the latter three representing USD stablecoins that currently earn up to 12% APR (or 12.73% APY).
One would be hard-pressed to find options in the crypto space giving higher rates for stablecoins, especially for smaller account size like myself.
Did you know? In crypto, very often you’ll come across these two terms –
- Annual Percentage Rate (APR) represents the annual rate charged for earning or borrowing money.
- Annual Percentage Yield (APY) takes into account compounding, but APR does not
Weekly payouts (instead of monthly)
This happens every Monday at 5:00pm (SGT).
The Pending Interest Payout (USD) is a ticker that increments in real-time which is a nifty trick for instant gratification if that is your sort of thing!
How does Hodlnaut manage to give out so high rates?
To put it simply, Hodlnaut lends out the assets that we deposit into the platform to established and vetted financial institutions that pay an interest rate.
The interest rates are determined by analysis of the supply and demand on the available crypto assets to set a fluctuating interest rate that adjusts as market conditions change. Earnings from previous months are also into consideration.
This also means that the current lucrative rate of 10% APR on Hodlnaut would likely be adjusted in the future, depending on the crypto outlook.
With the interest earned from lending, Hodlnaut takes a small portion of it and passes the rest to users like us. Assets are also lent to decentralized protocols and interest is earned from there.
How the Hodlnaut platform looks like and demo account
If you’re like me, we like to find out everything we can before putting our money and assets into a platform.
In a Hodlnaut review, I really like to read about experiences.
I love the fact that the platform is very responsive to transactions. Once my transaction is broadcasted and mined on the Ethereum blockchain, it promptly showed up in my account even as it was waiting for the pre-requisite number of blocks before it was confirmed.
One super important feature that they added in April 2021 which I also had helped to beta-test was the addition of the Token Swap functionality.
This means that within the Hodlnaut platform, you can potentially implement a crypto indexing portfolio with 1/3 in BTC, 1/3 in ETH and 1/3 in stablecoins and rebalance them periodically by buying the laggard component.
Update [24-Aug-2021] – The Token Swap functionality has been re-enabled!
Update [03-Jun-2021] – The Token Swap functionality is going to be temporarily disabled. I have reached out to the Hodlnaut team and basically, it is a regulatory compliance issue for specifically the Token Swap feature. All regulatory compliance requirements by MAS are currently being adhered to and Hodlnaut’s legal team is constantly working to move towards getting the licensing approval (see below Q&A).
This was exactly what I was doing with my BlockFi account since they had the token swap feature long ago and it worked extremely well for my DCA transactions from 2017 to 2020.
Of course, you will get a statement telling you how much you have made every week.
The rest of the Hodlnaut platform is actually pretty intuitive and simple to use. Rather than me explaining them, why not click into the demo account and give it a try yourself?
To me, this made all the difference as I was able to see and experience for myself what the platform is really like before signing up for my account.
In case you’re wondering, perhaps some mobile integration is on the roadmap as well?
On the comms side, I was also able to reach out fairly quickly to their support and Twitter when I had questions, which was nice.
Hodlnaut withdrawal fees
Deposits are free as per similar platforms, and Hodlnaut charge the following fees for withdrawal as of 3rd August 2021. Lower fees for-the-win!
Read on for a referral code that can negate 2 x withdrawal fee for your account if you choose to sign up!
Do note that fees may be adjusted due to market conditions. For example, when Ethereum network is congested, transfer of ERC-20 tokens would therefore be charged a higher fee.
As the name ‘Hodlnaut’ implies, such a platform is best suited for holding assets instead of trading and moving them excessively which will incur significant withdrawal fees!
Bonus : A few questions for the Hodlnaut team
I find it really nice when the team is able to address the audience directly, which is why I reached out to the Hodlnaut to reply to a few commonly asked questions I have received via DMs.
Below replies are given by Hodlnaut with minor editing by me.
1. Why should investors put their money with Hodlnaut instead of the “bigger” or more established players like BlockFi or Celsius?
As compared to BlockFi and Celsius, we offer higher interest rates, with no caps and tiers on user deposits.
Additionally, we are in the midst of applying for a Major Payment Institution License with the Monetary Authority of Singapore, essentially assuring our strong financial condition & track record, along with meeting the strict regulatory conditions like compliance, assets safeguarding and technology risk management – which are all important parts of serving our customers’ main interest.
2. The 10% interest rate is super attractive, but will they be maintained moving forward?
Although nothing is definite in the evolving crypto space, we’re working hard to ensure our rates remain competitive.
Perhaps there will come a time when we also need to adapt, but the time is not now.
3. Is there any message the Hodlnaut team would like to say to potential investors?
We strive to build a reliable and transparent business, where our users can trust us for the best service and products – we’re always open to user feedback and we continually strive to build the products and shape our platform to what our users want to use.
Ending thoughts for Hodlnaut review (2021) and $20 sign-up bonus
Seeing how BlockFi made a big boo-boo lately by erroneously transferring some Bitcoin to users in a promo-gone-wrong (the damage is relatively small), I have transferred a portion of my BlockFi funds into Hodlnaut to beef up my assets already in it. Consider it a little diversification.
Yes, there are risks to all crypto-related products/services and yes, I have a significant sum of money sitting in my Hodlnaut account.
I am willing to take on this risk and in return, I’ll be rewarded with higher returns.
Whether or not this is something you are willing to take on, is entirely up to your risk appetite. Nothing is risk-free.
You will receive a US$20 signup bonus when you make an initial deposit of $1,000 equivalent on any of their assets such as BTC, ETH, DAI, USDC and USDT.
This $20 will help to offset any blockchain transaction fees you incur as a result of getting your assets into the Hodlnaut platform, if you choose to do so.
Note : All crypto-related investments are subjected to higher levels of risks and users are responsible for their own decisions
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Hello! I’m Kevin, Turtle Investor
At the age of 30, I am the Personal Finance Blogger who laid claim to a negative net worth of minus $25,755 – and decided to turn things around.
- Seven years later in 2019, I hit CPF Full Retirement Sum (FRS) of $176,000 without making a single cent of CPF top-up.
- In eight years, I added $453,000 to my net worth (excluding the value of my HDB apartment).
- I made over $12,000 in alternative income in 2020 (and $20,000 in one month) in addition to my full-time job.
I am married to a lovely wife and that means dual income with no kids. In my free time, I chase miles so that we can fly in business class. My hobby is making pocket change off this blog and sharing everything I know with you!