Hodlnaut Review – up to 12.7% APY on stablecoins

Hodlnaut is a platform where individual investors can earn interest on their cryptocurrencies by lending it to corporate borrowers. Similar to BlockFi (review), Nexo (review), Gemini Earn (review) and Celsius, Holdnaut allows depositors to earn a return on their crypto assets.

It was started locally in Singapore by two entrepreneurs in March 2019.

Hodlnaut platform

The platform is elegantly designed. On the my account page, you’ll see an account overview, together with your account value, interest paid and pending payouts all in one view.

Hodlnaut also displays the next payout date prominently at the top. Interest is accrued daily and paid weekly every Monday, in-kind directly to your account. That means if you’ve deposited BTC, you will earn your interest in BTC.

On the page, you’ll also find your crypto balances, featured with the current interest rates based on prevailing market conditions. As you can see, the interest rates are denominated in both APR (annual percentage rate) and APY (annual percentage yield).

At the bottom, you’ll find all your transactions, including deposits and interest payments that are made weekly. You can also export them as a CSV.

Supported crypto assets

Holdnaut currently supports 6 crypto assets, namely BTC, ETH, DAI, USDC, USDT, and WBTC.

Hodlnaut offers up to 7.5% for BTC and 12.73% for stables, both above market rates.

Depositing crypto assets into Hodlnaut

The first step is to obtain the cryptocurrencies supported by Holdnaut above.

You can do it through an exchange with a fiat on-ramp like Binance (guide), Gemini (guide) or Crypto.com. My preferred way is through Gemini (easiest SGD on-ramp) or Binance (lowest trading fees).

Second, note the deposit address on your Hodlnaut account by going into Deposit/Withdrawals and choosing the crypto asset to deposit.

You will see a deposit address, in the below case I’ve selected BTC and will have a BTC address, copy this as you will need it later.

Note the address for depositing BTC into Hodlnaut

Once you have purchased the required crypto assets from the exchange of your choice, head over to the exchange’s withdrawal function and withdraw the crypto asset into your Hodlnaut address for the corresponding crypto asset.

For Binance, head over to Wallet > Overview

Click Withdraw and select Crypto > BTC (or the corresponding asset like ETH, USDC, USDT, DAI)

Then enter the recipient BTC address (the Hodlnaut BTC address above). Make sure that the network selected is BTC as we want BTC to go through the BTC network.

For ETH, USDC, USDT and DAI, select the Ethereum network as the tokens supported on Hodlnaut are of the ERC-20 standard.

Note the transaction fee for the withdrawal, enter the amount to withdraw and submit the withdrawal request.

For Gemini, head over to Transfer > Withdraw from Gemini

Select the respective crypto asset to withdraw, then follow the instructions on screen. The process should be similar.

Withdrawing from Hodlnaut

To withdraw from Hodlnaut, you need to first enable 2FA.

Then, on the same Deposit / Withdrawal page, scroll to the bottom and look for withdrawal. Choose the asset to withdraw and initiate the withdrawal process. All withdrawals are processed daily at 5pm SGT.

Note the withdrawal fee as well. The maximum withdrawal limit is 100 BTC daily for customers who have completed KYC.

Withdrawing crypto assets from Hodlnaut

You can also whitelist withdrawal addresses such that your withdrawals are only made to authorised addresses.

To do that, use Hodlnaut’s Withdrawal Whitelist feature to restrict withdrawals to a limited set of addresses only. Once you enable Withdrawal Whitelist, you will not be able to withdraw funds until the address is added to your withdrawal list.

Furthermore, you will have to wait for 48 hours before the whitelist is approved before you can withdraw.

You can enable this setting in User Settings on the top right.

Withdrawal whitelist

Fees

Hodlnaut charges a small withdrawal fee for various withdrawals from the platform depending on blockchain network conditions. There are no deposit fees.

Withdrawal fees depend on asset – but are roughly US$10 per withdrawal for stablecoins. The updated withdrawal fees are effective from 3 August 2021.

Token Swap

Hodlnaut also launched a token swap feature to swap between supported crypto assets on the platform.

Basically with this swap, you can choose the asset you wish to earn interest in and easily rebalance your asset holdings without ever leaving the platform, no need to withdraw to an exchange and spend transaction/withdrawal fees.

Hodlnaut risks and security

As with all platforms, using a third-party to hold your crypto assets introduces additional risks. For example, in addition to price risk of the crypto asset, you now hold platform risk (Hodlnaut gets hacked), counterparty risk (borrowers failure to repay loans), custody risk (custodian gets hacked), interest risk (downward revision in interest rates) and so on.

From their FAQ, Hodlnaut runs on a secure cloud infrastructure on AWS, with encrypted traffic. They also use industry-standard algorithms for password hashing and procedures.

Hodlnaut also integrates Fireblocks for its $250m of assets under management.

Fireblocks uses next-generation private key security (MPC-CMP) and hardware isolation technology to create multi-layer security, which eliminates a single point of failure and insulates digital assets from cyber-attacks, internal collusion, and human error. 

To mitigate lending risks, they choose to lend to selected vetted partners with solid credit score – the specifics on who they lend to and how much over-collateralised their loans are remain ambiguous.

Overall thoughts

Hodlnaut is a promising crypto lending platform that has grown strongly over the past 2 years. It has more than 23 headcounts, 5000+ users and growing every day.

With plans to add more assets to the platform and one of the highest yields for stablecoins, I hope Hodlnaut continues to deliver customer centric changes and find a niche for itself in this space.

They have also recently launched an iOS app and reduced withdrawal fees as their customers demanded it – it shows that they are extremely customer centric!

It’s an exciting future ahead!

Use this exclusive link to receive a US$20 signup bonus after making an initial deposit equivalent of US$1000 on any supported assets.

1 Shares:
6 comments
  1. Hows the spread like when using token swap (usdc to btc) as compared to binance? I might move my hodl portion there and rebalance accordingly.

    1. Binance is cheapest for crypto to crypto swaps at 0.1% spread – I always try to execute trades on Binance

  2. hmm. i am going to trsnfer USD to Gemini, (im guessing Gemini is the best of the 3 x fiat>crypto exchage?)

    what stablecoin should i be changing it to, inorder to move to Holdnout . i dont see USDC or USDT?

    1. Yeah Gemini has the best on ramp for SGD, but unfortunately Gemini only supports GUSD which is their native USD implementation.

      You could
      1) buy ETH/BTC with the USD and withdraw to Binance then swap for USDC/USDT but you’ll incur withdrawal fees on both sides

      2) withdraw GUSD into BlockFi and swap for USDC (free) and then withdraw to Hodlnaut (free once a month) or use BlockFi for interest

      3) use an alternative fiat on ramp with USDT or USDC withdrawals like Coinhako or Crypto.com

  3. Hodlnaut has removed the token swap function. What would be the cheapest way to buy DAI/USDC and withdraw it into hodlnaut to enjoy the high interest rates?

    1. Personally I’d use BlockFi (SGD -> GUSD -> USDC) then withdraw into Hodlnaut directly. Or Gemini (SGD -> GUSD) to BlockFi (GUSD -> USDC) then withdraw.

Leave a Reply

You May Also Like