AFAIK that was limited to the first $10k in deposits, so it seemed plausible as a some sort of customer acquisition cost. Also, 8% was around the going rate for decentralized lending protocols, so it only seemed high in comparison to FDIC protected savings accounts.
> AFAIK that was limited to the first $10k in deposits, so it seemed plausible as a some sort of customer acquisition cost
$800 per year per customer? Ehh. Also, above $10k and up to $10m it was 5%/yr... which I think breaks that explanation as no one is going to argue that a half million dollars a year is a reasonable customer acquisition cost! :)
> going rate for decentralized lending protocols,
Don't use euphemisms here, the term is ponzi schemes. These yield programs were across the board ponzi schemes with no substantial source of income other than the deposits of other users.
(and don't let the fact that Bitcoin critics have called it a ponzi scheme in the past confuse you: Bitcoin has never promised a yield, it doesn't need a source of income. The fact that bogus criticism uses a word doesn't make it less legitimate where it applies.)
Yes, 8% only seems high in comparison to companies that are ran by adults that don't evaporate with your money every few years.
No financial company in the world that isn't a fraud is going to pay me a $800/year for parking $10,000 in their bank account, once all risks are taken into account.
The first six months of this year it was possible! All that would be needed would be a parent company that creates child LLC’s, one per customer, and then purchases $10,000 of I Series bonds using the child LLC tax ids.
The rate was 9.6% so you would have been pocketing a 1.6% spread on the customer deposits.
AFAIK that was limited to the first $10k in deposits, so it seemed plausible as a some sort of customer acquisition cost. Also, 8% was around the going rate for decentralized lending protocols, so it only seemed high in comparison to FDIC protected savings accounts.