Users who save their bitcoin on a new savings wallet from Luno will earn a 4 percent interest rate, the company said on Monday.
The global cryptocurrency exchange is launching its savings wallet at a time when global interest in bitcoin and the entire cryptocurrency market is starting to gain momentum driven by an ever-weakening global economy and poor performances of the different local currencies. A recent report conducted by Luno found that 40 percent of people globally do not have confidence in their local currency. Also, more than half of respondents (54%) are not currently earning interest on their money through their current or savings bank account. In Nigeria, traditional banks offer less than 2 percent interest rates on a savings account.
Bitcoin’s attraction also comes from the growing clamour for a single, global currency. The cryptocurrency is considered as having the right properties for a world currency. About 50 percent of people worldwide want to see a single, global currency and bitcoin so have outperformed other stock exchanges and gold in 2020.
With the new bitcoin wallet, Luno users can make immediate payments in bitcoin to any account worldwide while they pay as little as a fraction of a cent using the new platform.
“In a time of economic uncertainty, the Bitcoin Savings Wallet is a safe alternative for anyone looking to make meaningful savings on their money,” Marcus Swanepoel, CEO, and co-founder of Luno said. “Almost 95 percent of our customers have said they want to earn interest on their bitcoin and because of the nature of bitcoin, we are able to offer a much higher interest rate than traditional savings accounts.”
The 4 percent interest comes with no fixed terms, no admin fees, and users can move their funds into a normal wallet whenever they need to. Another feature of the wallet is that the interest gets paid out on the first of the month. In essence, users can decide to leave their earnings in their savings wallet to compound and grow exponentially, or they can withdraw them straight away.
“Introducing interest with a bitcoin savings account comes at a time when traditional investments have shown vulnerability at a time of crisis,” Swanepoel said. “There has never been a better time to utilise a currency that does not rely on a healthy economy to determine its value.”
The new Luno saving wallet will enable customers who have a BTC balance to earn passive income on their idle balance with little effort and no penalties. Saving 1 BTC at a simple interest rate of 1.5 percent per annum would generate the customer 0.015 BTC per annum (around £124.00 GBP/ $160.00 USD at the time of writing).
