So, I have small amount of cryptocurrency I bought and mined over the years and will HODL, but I am seeing news articles and advertisements about earning interest on my coins. And the returns are not bad--5 to 7% per year.
It seems BlockFi is the front runner. They seem to have partnerships with the major US crypto exchanges, e.g. Gemini and Coinbase (I am in the USA). I am also googling and trying to educate myself.
But, I have serious concerns about learning my crypto to 3rd parties. What happens if the institution that I loan to, for example BlockFi, goes brankrupt? I assume I will lose my crypto. Would it be safer to loan to an exchange and I don't run that risk?
What are your experiences so far with loaning your crypto?
What place do you loan to, or recommend loaning your crypto to?
You could look at BlockFi, Celsius, or even some of the products that Binance offers.
But none of them are going to be truly risk free assets. But that's the tradeoff that you're signing up to - you are essentially taking on a risk that whatever ventures that your funds are used to undertake and/or the platform itself will fail, in which case you may only partially recoup your principal amount.
If you are truly concerned about third party risk, lend out your coins against collateral on bitcointalk or other true p2p sites. Then you hold the collateral yourself (if your rep is good enough, ofc).