Updated March 23, 2022

Hodlnaut Review

Read more about Hodlnaut
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Hodlnaut lets you earn compound interest on your crypto, but is it safe and legit? Read on to find out.

Overall Score

3.5

Cryptocurrency Trading

3.5

Interest Accounts

4.5

Crypto Loans

1.0

Mobile App

4.0

Commissions and Fees

5.0

Ease of Use

5.0

Research

1.0

Safety

4.0
5-point scale (the higher, the better)

Pros and Cons

  • Fairly Generous Interest Rates
  • Fee-Free Coin Conversions
  • Security-Minded Platform
  • Crypto-Loans Unavailable to Individuals
  • Limited Number of Coins

Bottom Line

Cryptocurrency lending platform with fairly good rates for a limited number of coins

Once you buy cryptocurrency, what exactly can you do with it?

With Hodlnaut, you can earn nearly 13% interest on your crypto holdings. But is it a trustworthy platform?

And where do they store your assets?

In this review, learn about the features, fees, and security of Hodlnaut. Plus, find out how it compares to popular competitors Celsius and BlockFi.

What is Hodlnaut?

Founded in 2019 by Juntao Zhu and Simon Lee, Hodlnaut is a Singapore-based crypto lending platform. They reached 5,000 users in May of 2021, with $500 million assets under management.

On Hodlnaut, users can earn up to 12.73% interest on their cryptocurrency (at time of writing), paid weekly, on their 6 supported assets including popular coins Bitcoin and Tether.

They also offer fixed-term, crypto-backed loans for users with over 100 BTC to deposit, and a token-swap service.

Hodlnaut is currently accessible through their desktop site, though they have an iOS app in the works. Other upcoming features include integration with iTrust.Insure, portfolio management, and auto- or scheduled swaps.

What Cryptocurrencies Do They Support?

At time of writing, Hodlnaut has a fairly limited range of cryptocurrencies. They support the following 6 popular cryptocurrencies and stablecoins:

  • Bitcoin, Ethereum, Dai, Wrapped Bitcoin, USD Coin, Tether

Where Are They Available?

Hodlnaut is available in countries all over the world, but in compliance with sanctions, is not available in the following countries:

  • Iran, North Korea, Sudan, South Sudan, Syria, Cuba, or any other country specified by the Sanction Authority

Hodlnaut Features

Hodlnaut has a variety of useful features for crypto traders and "hodlers" to take advantage of. Let's look at them in detail, below.

1. Interest-Earning Accounts

As a crypto borrowing and lending platform, Hodlnaut's main feature is its interest accounts.

These accounts work similarly to high-yield savings accounts offered by traditional banks. But because the risk is higher with crypto, the interest rates are proportionally higher as well.

Like similar platforms, Hodlnaut usually offers higher rates for stablecoins than they do for other cryptocurrencies. Stablecoins are coins whose value is pegged, at least in theory, to the value of a fiat currency such as the U.S. dollar.

Interest rates vary by coin and by volume of deposits. Each coin has a range of potential rates, with higher rates offered for smaller deposits, and decreasing the more you invest. You'll still keep the higher rates on your original investments, but only up to the threshold of the next rate.

Here are Hodlnaut's highest and lowest rates per coin at time of writing.

CryptocurrencyHighest Potential Rate (APY)Lowest Potential Rate (APY)
Bitcoin7.46%1.00%
Wrapped Bitcoin7.46%1.00%
Ethereum7.46%2.02%
Dai8.32%2.02%
USD Coin12.73%2.84%
Tether12.73%3.04%

These rates may change due to market conditions, but you should always be able to find up-to-date rates here.

Hodlnaut presents rates both in APR and APY. APR is the interest rate without taking into account compound interest, while APY is the effective rate when you include compounding over the course of a single year.

Can I lose money on Hodlnaut?
Yes, there is always risk involved with lending out your crypto. Hodlnaut interest accounts work by lending out user funds at higher rates than the accounts themselves pay. Although Hodlnaut takes care to minimize counterparty risk by maintaining LTVs of 70% or lower, the possibility of default on loans exists. As a general rule, never invest money you cannot afford to lose.

If you're worried about losing your funds, remember that you can deposit and withdraw at any time, and there are no lock-in periods or minimum deposits.

2. Crypto-backed Loans

Crypto-backed loans are Hodlnaut's other main offering for those with crypto holdings. However, Hodlnaut currently only offers these loans to corporations and institutions, not to individuals.

Here's how they work:

Because of the way crypto is regulated, selling it is considered a taxable event, and you'll need to pay capital gains taxes on any profits you've made.

Crypto-backed loans are a way to avoid this if you are only interested in taking money from the account temporarily.

Every crypto investor is well aware of the volatility of the market—its tendency to experience dramatic shifts in very short periods of time.

By taking a loan against the value of your crypto rather than selling it, you can avoid paying taxes on your gains. Not to mention, you won't have to worry about missing out on potential growth while you're not holding it.

An Example: Imagine you needed $30,000 at short notice, and so you sold a Bitcoin you'd been holding. Then, right after you sold, the price of Bitcoin rose 20% in a matter of hours. All those potential earnings would be lost. But with a crypto-backed loan, the Bitcoin is still yours. You can pay back the $30,000, and pocket the 20% gain.

3. Token Swaps

Hodlnaut's token swaps are a convenient feature that allows users to switch seamlessly between the supported cryptocurrencies available on the Hodlnaut platform.

If you have Bitcoin and want Ethereum, you can use token swap to make the trade, and best of all, the service is fee-free.

Fees to Look Out For

Luckily for Hodlnaut users, there aren't too many fees you have to worry about when using the platform. But there are some you should be aware of.

They charge withdrawal fees when you take your cryptocurrency off the platform to pay for transactions on the blockchain. These fees vary depending on market conditions and from coin to coin, but here's what the rates looked like at time of writing.

CryptocurrencyWithdrawal FeeMinimum Withdrawal
Bitcoin0.0004 BTC0 BTC
Wrapped Bitcoin0.0004 WBTC0 WBTC
Ethereum0.0036 ETH0 ETH
Dai10 DAI0 DAI
USD Coin10 USDC0 USDC
Tether10 USDT0 USDT

They do not charge Deposit Fees or Token Swap Fees.

You can find their up-to-date fees listed here.

Security

With the inherent risks involved in trading and storing crypto, security of a platform is an important issue to consider. Here are some of the tools that Hodlnaut employs to keep your data and your coins safe.

  • Secure Cloud Infrastructure on AWS
  • SSL Encryption
  • Password hashing
  • Two-Factor Authentication Required
  • Address Whitelisting
  • Rate-Limiting to prevent brute force attacks
  • Partnered with Fireblocks to ensure crypto safety
  • Security Awareness Training for employees
  • Optional individual insurance through Nexus Mutual's Hodlnaut Custody Cover
  • No use of hot wallets

Is Hodlnaut FDIC-Insured?
No, due to the regulatory restrictions around cryptocurrency, Hodlnaut is not FDIC insured. They do not deal with fiat currencies.

How It Compares

Hodlnaut vs Celsius
Celsius is another well-known crypto borrowing and lending platform. Based in London, they offer many of the same services that Hodlnaut does, including interest accounts and crypto-backed loans.

Celsius offers potentially higher rates of return than Hodlnaut does, with the caveat that they operate a tiered loyalty system, with bonuses offered for holding their proprietary token CEL.

This is a downside for users in the U.S., as it is only available there to accredited investors. Overall, traders in the United States will find better returns on Hodlnaut.

Read more: Celsius Review

Hodlnaut vs BlockFi
BlockFi has a very similar model to Hodlnaut's, though they offer 8 or 9 coins to Hodlnaut's 6. They do not have any requirements for earning the highest rates, and like Hodlnaut, their returns decrease with larger deposits.

In general, Hodlnaut has much more generous interest rates, sometimes nearly double what BlockFi is offering.

Read more: BlockFi Review

Bottom Line

While Hodlnaut doesn't match the highest rates available with some of their competitors, they do offer fairly generous returns without any expensive hoops to jump through, which many similar platforms can't say.

Their range of offerings for retail investors is somewhat limited. But if you're looking for interest accounts without access to the crypto-backed loans that some companies offer, then Hodlnaut may be for you.

Nexo

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BlockFi

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Jeremy Harshman is a protector of art and writing at CreditDonkey, a crypto comparison and reviews website. Write to Jeremy Harshman at jeremy.harshman@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.

Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.

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