I do have some USDC parked on BlockFi to access the 8.6% APY and promotional bonuses they offer. The interest pays out (and compounds) monthly, but the website and app have a daily-updated “accrued interest” counter, which is quite satisfying to check on – especially if you also have old-fashioned “high yield savings” (0.5%) to compare it against!
Shamelessly leaving my referral link for the deposit bonus: https://blockfi.com/?ref=66eef4f3
As far as I understand, BlockFi can pay out high rates for stablecoin deposits because they’re able to turn around and lend it out at even higher rates to crypto hedge funds. Those hedge funds in turn engage in yet still more profitable carry trades and other arbitrage; and they don’t have many other willing sources of USD leverage.
It’s cool to have this complementary way of profiting from the crypto ecosystem, with BlockFi providing me a very simple customer experience, and managing all the lending risk. The terms are clear though: they may have to halt withdrawals in “extreme market conditions,” and your deposit is not insured in the event they blow up. So, despite feeling like a savings account (in good times), it’s only suitable for a small, diversifying slice of an overall portfolio, and doesn’t replace a fiat emergency fund.