Cryptocurrency exchange Luno has announced that its customers can now earn interest on Bitcoin, Ethereum, and USDC.
These currencies have been added to the platform’s savings wallet, which means that the company’s seven million customers can now earn up to 4% interest per annum on Ethereum holdings and up to 7.6% on their USDC balances. Interest is earned and paid in cryptocurrency.
Luno said this solution creates a flexible way to earn passive income on cryptocurrency holdings.
It also noted this is almost double the interest rate offered by South Africa’s large banks on flexible savings accounts (which range between 1% and 4% per annum).
Customers begin earning interest immediately and receive interest payments monthly. There are no hidden fees, no fixed terms and no minimum deposits.
Customers also have 24/7 access to their crypto within Luno’s savings wallet service.
This augments Luno’s existing Bitcoin savings wallet, which was launched five months ago and has been adopted by almost 250,000 users. To date, over $500,000 worth of Bitcoin has been paid out in interest.
“Luno research last year showed that over a third of those surveyed (35%) were not earning any interest on their traditional cash savings at all, so growing savings options and making saving simple and accessible is a priority for us,” said Luno Africa GM Marius Reitz.
“The same research from last year found 54% are not earning interest through their current or savings bank account, with 40% lacking confidence in their local currency.”
Reitz added that a high percentage of South Africans who own cryptocurrency do so for speculative investment purposes, with the majority holding their crypto for the long term.
“If your crypto investment strategy is holding your crypto long-term (HODLing in crypto speak), the savings wallet earns you additional interest for what you were already doing,” Reitz said.