Today we’re introducing a new way to earn up to 8% annually on your Bitcoin (BTC): Active Rewards.
For those who have a market view on where the price of Bitcoin will go, Active Rewards can be used to maximize your potential rewards at up to 10x the rate of Passive Rewards (formerly “Rewards”).
What is Active Rewards?
Active Rewards provides a way for you to earn on your Bitcoin in an otherwise down or flat market. Specifically, it lets you subscribe to a strategy to earn rewards if you believe the price of Bitcoin won’t go up significantly in the next week.
It could offer a significantly higher rewards rate on Bitcoin than Passive Rewards (up to 8% annually vs up to 0.65% annually, at current rates as of April 2023. To view live rates visit our website).
How does it work?
Every week, a new Active Rewards strategy is made available to all Active Rewards customers that sets a trigger price for Bitcoin that is higher than the current market price. If you believe the price will be under the trigger price at the end of the week, subscribe to the strategy and earn an annual rewards rate on your Bitcoin, paid out weekly on Fridays at 8am UTC.
The trigger price and the rewards rate are set at the start of each weekly cycle and if you don’t withdraw your funds you’ll automatically be rolled into the strategy for the following week.
Since the specific trigger price changes each week, let’s take a look at some scenarios using the following values:
- Currency: Bitcoin
- Duration: 1 Week
- Annual rate: 8%
- Current price: $20,383
- Trigger price: $22,000
Scenario 1 — Price of Bitcoin is at or lower than the trigger price at the end of the week
If the price of Bitcoin ends the week at or lower than the trigger price, you’ll receive your rewards for the week and your Bitcoin will be returned to you valued at the market price.
So in the scenario depicted below, if you start the week by depositing 1 Bitcoin in Active Rewards, you’d end the week with 1.00147705 which would then be re-subscribed to earn rewards for the following week.
Scenario 2 — Price of Bitcoin is higher than the trigger price at the end of the week
If the price of Bitcoin ends the week higher than the trigger price, you’ll still receive your rewards for the week but your Bitcoin will be returned to you valued at the trigger price, resulting in a reduction in your Bitcoin-denominated balance.
So in the scenario depicted below, you’d start the week with 1 Bitcoin, at the end of the week you’d receive your 0.00147705 Bitcoin reward, but because the price of Bitcoin went over the trigger price your Bitcoin balance would go down from 1 to 0.88147705 Bitcoin. Thus, you’d have a balance of 0.88147705 Bitcoin which would be re-subscribed to earn rewards for the following week.
What are the risks?
While Active Rewards offers compelling weekly rewards on your Bitcoin, weekly market movements above the listed trigger price can reduce your Bitcoin-denominated balance.
How to get started
You can get started by transferring as little as $1 in Bitcoin to an Active Rewards Account:
- Log in to your Blockchain.com Wallet using a web browser or a mobile device.
- Click Earn in the navigation bar.
- Find Bitcoin (Bitcoin) Active Rewards in the table and click Get started.
- Select your Bitcoin Trading Account or Bitcoin Private Key Wallet, enter the amount you’d like to transfer, agree to the terms, and add balance.
- Your Bitcoin has now been transferred to your Active Rewards Account.
Note: Active Rewards is not available in all countries. You can check your eligibility here.
IMPORTANT NOTE:
The purchase of crypto entails a risk. The value of crypto can fluctuate and capital involved in a crypto transaction is subject to market volatility and loss.
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Earn up to 8% annually on Bitcoin with Active Rewards was originally published in @blockchain on Medium, where people are continuing the conversation by highlighting and responding to this story.