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You might have noticed lately that we’ve been introducing ways to earn free Bitcoin (BTC) through apps such as Bitcoin Aliens or the Free Bitcoin App. This is mainly due to the fact that the price of BTC over the past few months has increased dramatically.
While we can’t be entirely certain where its value will go from here, you might as well earn some interest on it just like you earn interest on cash in a bank account. Now you can easily do that with a Bitcoin trading company called Bitfinex.
What Is Bitfinex?
Bitfinex is a global trading company for Bitcoin, and they’ve been around for nearly almost 2 years. They’re reputation proceeds them as one of the most secure places to invest and trade Bitcoin along with other crypto-currencies.
Just like any other brokerage firm (Ameritrade, Optionshouse, etc.), they loan out Bitcoin or cash to their clients through what’s called margin trading. This type of trading occurs when someone wants to invest money they don’t have, so they borrow some for a short time at an extremely high interest rate. The reason they might do this is because they’re almost certain a stock will go up a high percentage the next day.
With Bitfinex, you can use your Bitcoin to participate in this margin funding, where you loan out your funds to other investors and get a portion of the interest that they pay. You’re guaranteed to always get your money back and more.
Keep in mind that the rate depends on how the markets are doing. If the markets are at the moment very positive about the value of Bitcoin, then more than likely your BTC will be loaned out at a higher interest rate, and thus you’ll earn a bigger return. These rates change on a daily basis.
How Do I Get Started Earning Interest On My Bitcoin With Bitfinex?
Getting started with Bitfinex is a little complicated at first. However, we’re going to walk you through each step with pictures in order to ensure that you go through the process correctly.
1. Get Bitcoin. If you don’t already have Bitcoin and would like to start investing in some, a great place to buy it is through a Bitcoin Wallet called Coinbase. Signing-up with them is completely free. 1 BTC is currently valued at $450, but you don’t have to buy a full one. If you want, you can buy a fraction of it, but you need a minimum of $50 worth to participate in margin lending with Bitfinex.
Keep in mind that each time you buy some there’s usually a small transaction fee ($1 or $2 dollars), so it’s usually better to buy as much as you can in one shot rather than in multiple transactions. You can buy Bitcoin with Bitfinex, but I personally trust Coinable due to the fact that they also have phone number verification each time you log-in.
2. Register with Bitfinex. The next step is to create a free Bitfinex account by clicking this link here. You’ll need to enter in a username and password. In order to secure your account even further, we recommend you go through their verification process listed under account settings.
3. Deposit funds. Go to the “Deposits” tab at the top of the Bitfinex dashboard. Copy any one of the 3 Bitcoin addresses and go back to your Bitcoin Wallet. Send at least $50 USD in Bitcoin to your Bitfinex account.
4. Enable margin funding. On the Bitfinex dashboard, select Margin Funding > BTC > > Offer Funding as shown in the image below. Enter in the amount you wish to fund, and also enter in a funding period of 2 days instead of 30. You also want to check “FRR” (Flash Return Rate). By doing these two things, the interest rate will change every 2 days based on what the market price is, and FRR enables you to get the highest amount of interest available.
5. Setup Autorenew. By setting up Autorenew, you allow to your Bitcoin to be lent out more than one time. If you don’t do this, you’ll only be involved in Margin Funding the first time you activate it and you’ll have to manually do it from there on out. Again, be sure to select FFR and a period of 2 days.
Bitcoin is extremely volatile, making it quite difficult to discern what type of return you’ll be getting back. However, if you want to invest in Bitcoin to diversify your investment portfolio, you might as well be earning some interest on it whether the value goes up or down. Here are some ways to earn some free Bitcoin:
If you’d like to share with us your opinion regarding Bitcoin or how much you’ve made thus far using Bitfinex, feel free to let us know in the comments below. Otherwise, happy investing and thanks for reading!
My name is Jason Wuerch and I'm currently located in Madrid, Spain running a personal finance blog called Frugal For Less. My goal is to help everyone and anyone willing to make and save money through easy and simple ways that don't require much effort. Just because you're frugal doesn't mean you have to give up life's luxuries.