How do the top crypto business accounts compare to traditional alternatives?

Businesses of every size and type often find themselves with treasury funds that could be generating a return, but that must still be accessible in the event of an emergency (or global pandemic, even). In this case, they may seek a business account that will offer a decent return as well as flexibility and convenience. 

The last decade has, however, witnessed a massive and ongoing disruption in the financial sector, and business investors are faced with new decisions. Cryptocurrency is no longer the preserve of tech specialists, but fast becoming a FinTech sector that is challenging traditional banking. So the next question for business investors should be: how do crypto business accounts compare to traditional alternatives?

Cryptocurrency business accounts

Below is listed a selection of the best cryptocurrency business accounts on the market today including the rates, features and services that potential investors will likely be most interested in.

YIELD App

  • Deposits in USDT, USDC, and ETH can earn up to 18% APY
  • Quick and easy to use, with an in-house insurance pool to protect deposits and platform-wide insurance coming soon. Funds are never locked
  • No fees on deposits and minimal fees on withdrawals
  • A referral rewards program in the near future

Nexo

  • Earn up to 10% APY on 18 different cryptocurrencies, with a 2% bonus for earnings on Nexo
  • Ledger Vault used to insure crypto assets up to $150 million
  • Up to five free withdrawals per month can be made, then gas fees are applied
  • No additional bonuses are currently offered

BlockFi

  • APYs up to 9.5% on BTC, ETH, LTC, USDC, GUSD, and PAX
  • One free withdrawal can be made per month
  • Withdrawal fees charged are 0.0025 BTC, 0.0015 ETH, 0.0025 LTC, and 0.25 USD
  • Sign-up bonus of $10, referral bonus of $25, and Bitcoin credit card sign-up bonus up to $250

Celsius

  • Investments in over 30 cryptocurrencies for APYs up to 18%
  • No minimum balance and payouts are made every week
  • Assets are insured by PrimeBlocks and FireBlocks
  • No fees are charged and there are loyalty reward bonuses

Ledn

  • APYs up to 11% on USDC and BTC
  • Withdraw funds at any time 
  • Interest payments are made on a monthly basis
  • $10 fee for withdrawing USDC

Traditional business accounts

Here we are using “traditional” to mean accounts holding fiat, or “real world” cash currency rather than crypto, so these types of business accounts could include those provided by online banks and not just brick-and-mortar banks.  

Tab Bank

  • 0.25% APY for Business Money Market Accounts and Business Savings Accounts
  • No bank cards or checkbooks are offered
  • Minimum deposit of $25 and minimum balance of $1
  • FDIC insured up to $250,000
  • No fees are charged

Live Oak Business Savings

  • 0.50% APY for business savings accounts
  • Convenient to open and manage accounts online and make use of the mobile app
  • No minimum deposit or balance
  • FDIC insured up to $250,000
  • No monthly or maintenance fees are charged

Axos Business Savings

  • 0.20% APY for business savings accounts
  • Online, mobile banking, and remote deposit, with minimum deposit of $1,000
  • Deposit accounts are FDIC insured
  • Monthly fees of $5 unless average daily balance exceeds $2,500
  • Welcome bonus of $100

Prime Alliance Bank Business Savings

  • APYs up to 0.50% for balances from $200,000
  • Online banking and mobile banking
  • Six withdrawals per month are permitted
  • All accounts are FDIC insured
  • No fees are charged

First Internet Bank Money Market Savings

  • 0.40% APY for business savings accounts
  • One bank card is available
  • Six transactions permitted per month
  • All accounts are FDIC insured
  • Monthly fees of $5 unless average daily balance exceeds $4,000

How they match up 

When deciding where to hold a business account, a firm should consider its main objectives. Below are some of the main factors that may affect a decision.

Interest

The huge difference here is plain to see – even the best APY offerings of traditional banks pale in comparison to cryptocurrency business accounts. If you move your savings from an Axos account to a YIELD App account, you could see a 100% increase on your returns. 

The sad truth is that business accounts that offer just a half percent in APY are doing much better than the US national average, which is currently just 0.05%. While traditional accounts compete to offer the best decimal rates, though, returns on crypto accounts mean that businesses can actually generate a return on their assets, instead of watching inflation slowly eat away at their value.

Convenience and accessibility

At this point in the digital revolution, users expect all their services to be online and mobile, but just how easily and immediately finances are at our fingertips varies. With traditional business accounts, some higher-yield accounts lock away funds for 12 months as the price for higher rates, while others may limit the number of monthly withdrawals allowed. 

Some cryptocurrency business accounts also limit access to funds for periods of time, though this is recognized as a drawback for users. With all types of savings accounts, access to funds and usability depends on the particular service.  

Security

Many traditional banks are keen to emphasize the benefits of FDIC insurance on their savings accounts because they are only too aware that this is generally not provided by their challengers in crypto. There are certainly risks involved with cryptocurrency investments, but when you are banking with a trusted cryptocurrency organization that takes the right security measures, these can be reduced considerably. 

However, there are other insurance schemes that can be applied to crypto accounts to secure deposits, and funds can be held in secure custodian wallets. Funds can also be ring fenced or switched between hot and cold (online and offline) wallets for extra protection. 

Fees

This is another factor that can apply to both traditional and crypto business accounts so business investors need to check how fees will apply to their savings and whether these are offset by the high APYs. Many traditional banks and crypto savings platforms do not charge any fees, though charges may be found in other areas. Fees are often negligible, though they could have a noticeable impact when transactions are made regularly.  

Extra incentives

Although bonuses and promotions are not the most central concern, they are not unwelcome and may even offset any fees incurred initially. Welcome bonuses and referral bonuses are common with crypto business accounts, and investors can rise to higher levels in rewards programs by making larger investments. Bonuses are not as common with traditional accounts, possibly because banks are less able to adapt to changing expectations in the financial services industry. 

It doesn’t take an accredited financial advisor to see that the APYs offered by traditional business savings accounts with even the highest interest rates are simply no longer generating a real return. Indeed, when inflation is taken into account, businesses are losing money in fiat cash accounts every year. 

Although there are other factors involved – security being chief among them – there are ways of managing risk and keeping it to a minimum. You can find out more about securing your cryptocurrency here.

For businesses that are concerned with increasing profits and maximizing growth, though, funds left depreciating in a bank account is a wasteful loss. This may make now the time to look to the technology of the future that has the potential to deliver the highest returns.

Are you interested in a business account that can return up to 18% APY on your USDT, USDC, ETH and BTC? Sign up for a YIELD App account today!

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