Savings account interest: How to make the “crypto carry trade” work for you...
The carry trade is a relatively well-known concept in traditional finance. It involves borrowing once currency at a low-interest rate then converting it to another country’s currency with high-interest rates and investing that in the highest rate bonds of the country. This was popularized with the “yen carry trade” a few years ago where traders borrowed yen at nearly zero interest rates, converted it to U.S. dollars and invested the dollars into U.S. Treasuries with the best bank interest rates. This same behavior can be replicated with traditional banks and crypto platforms.
How to use the best savings account interest rates to your advantage...
The first step of the crypto carry trade is to find the best bank interest rates. In this case, this means finding the lowest rates possible. Then, request a loan in a fiat current (e.g. USD or EUR) and use that fiat to buy a stable cryptocurrency such as Tether (USDT). Now that you have a stablecoin, it’s time to find a crypto platform with high savings account interest.
FinTech platform YouHodler has the highest savings account interest rates at 12% meaning you can deposit your USDT (and other cryptocurrencies) on the platform and earn 12% on that deposit every year with interest paid out monthly.
Maximize your savings account interest rates even more...
To add an additional but optional step to the crypto carry trade is to reinvest the interest earned into another asset. For example, after earning the 12% on your USDT savings, then one could put that 12% towards a Bitcoin (BTC) investment and capitalize on its growth that way. These are all creative ways to capitalize on the best bank interest rates found in traditional finance while simultaneously benefiting from the innovation of the new digital economy.
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Author: Matt Miller
London News Desk
Via NEWSROOM | Crypto Press https://ift.tt/2Bf4SKE
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