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A beginner’s guide to earning interest on stablecoins

Writer's picture: Èric LluchÈric Lluch

Cryptocurrency is transforming the way we think about money, and stablecoins are very relevant in this financial revolution in my opinion. Unlike volatile cryptocurrencies like Bitcoin or Ethereum, stablecoins are pegged to a stable asset like the US dollar, making them a safer choice for earning interest.


This is great for beginners because if the exchange is secure and reliable, you can get much higher yields than holding real-world currencies such as US dollars or €. In this guide I will show you how to earn interest on your stablecoins and maximize your returns with minimal risk. Let’s dive in!


Outline: A beginner’s guide to earning interest on stablecoins

  • What Are Stablecoins?

  • Why Earn Interest on Stablecoins?

  • How to Earn Interest on Stablecoins

    • Choose a Reliable Platform

    • Understand Interest Rate Options

    • Deposit Your Stablecoins

    • Start Earning

  • Optimizing Your Yields

  • Dollar-Cost Averaging (DCA)

  • Popular Strategies for Maximizing Stablecoin Earnings

    • Staking Stablecoins

    • Lending on DeFi Platforms

    • Yield Farming

  • Risks to Consider

  • Frequently Asked Questions

  • Start Earning Today


What Are Stablecoins?


Stablecoins are digital currencies designed to maintain a stable value by being tied to a reserve asset such as fiat currency (e.g., USD) or commodities. Popular stablecoins include:


Their stability makes them ideal for earning interest without the fear of significant price fluctuations.


But some exchanges such as Nexo offer even a version of a digital coin of € called EURx in which you can also earn interest per year.


Why Earn Interest on Stablecoins?


Earning interest on stablecoins can be more lucrative than traditional savings accounts.


Here’s why:





  • Higher Interest Rates: While most banks offer a 0.01%-0.5% annual interest rate, brokers offer up to 3.5% annual interest rate and stablecoin interest rates can range from 4% to 16% or more. Here you can see the brokers, exchanges, and banks that are offering highest interest as of 2025 with referral links that give you and me bonus (https://www.byobanking.com/post/how-to-earn-800-in-one-day-with-sign-up-bonuses)


  • Passive Income: Your stablecoins work for you 24/7. In fact, in many exchanges, you get your annual interest part paid daily, which helps grow the compounding effect enormously. For example, in Binance, or Nexo you are paid every day. If you get 16% on your USDT, this means that 1000€ will make you 160 € / 365 = 0.43 € per day.This means that the second day you will compute your 16% on your 1000.43 and so on, leading you to exponential growth (for the curious ones, you would lend up with more than 1173 € instead of 1160€ because of daily interest). Other platforms such as YouHodler also offer fix high rates of about 12% but they’re paid weekly instead of daily.


  • Flexibility: Various platforms allow you to withdraw funds anytime or lock them up for higher yields. In fact, since this 4-16% interest rate is paid daily and is flexible, you can just withdraw it when you want without any penalty and transfer it to another exchange to get the most out of your stablecoins. Moreover, if there is a current crash in the market you can use your stablecoins to buy cryptocurrencies during the deep phase.


How to Earn Interest on Stablecoins


1. Choose a Reliable Platform


There are several ways to earn interest on stablecoins, but the most popular options are:


Centralized Exchanges


Platforms like Crypto.com, Nexo, YouHodler, Binance, and HTX offer fixed or flexible interest accounts. They handle the lending process for you, simplifying the experience.


Tip: Use our affiliate links to sign up for these platforms and earn exclusive bonuses (up to 100 USD):



2. Understand Interest Rate Options


Flexible Interest Accounts


  • Withdraw your funds anytime.

  • Lower interest rates compared to fixed accounts.


Fixed-Term Accounts


  • Lock your funds for a fixed period (e.g., 1 month, 3 months).

  • Earn higher interest rates. In general.


For instance, Crypto.com offers up to 15% interest for fixed-term deposits on USDC, while flexible accounts might offer around 6%. However, Nexo is offering 16% of flexible interest on your stable coins if you hold 10% of your wallet in Nexo coins. I’m currently doing that because the Nexo coins are also giving me 6% flexible.


3. Deposit Your Stablecoins


Once you’ve chosen a platform:

  • Transfer your stablecoins from your wallet to the platform’s deposit address.

  • If you don’t own stablecoins yet, you can buy them with your FIAT (EUR, USD, etc) on major exchanges like Binance or Crypto.com. You can also sell any cryptocurrency 


Affiliate Bonuses:

4. Start Earning


Your interest will generate (accrue) daily, weekly, or monthly, depending on the platform. Monitor your earnings and adjust your strategy as needed.


Optimizing Your Yields


I’ve been optimizing my yields by moving my funds between exchanges when interest rates fluctuate. For example, if one exchange lowers its annual percentage yield (APY) and another increases it, I transfer my stablecoins to the higher-yielding platform.

This strategy helps me consistently achieve the best returns on my stablecoins. To make this process even easier, I’m working on a template or app that summarizes the APY for each coin and platform, including the costs of transferring between exchanges. This way, you can quickly determine whether moving your assets is worthwhile. This will be free for all the subscribers to BYO banking.


Dollar-Cost Averaging (DCA)


Another strategy I’ve personally followed since 2015 is dollar-cost averaging (DCA). I invest at least €10 in crypto every month, regardless of market conditions. Many exchanges or lending platforms, including Nexo and Binance, allow you to set up automated DCA investments weekly or monthly, making it a hassle-free way to build your portfolio over time.

If you’re looking for a more cost-effective approach, you can also implement DCA programmatically. Let me know in the comments below if you’re interested in learning how to do this.


Popular Strategies for Maximizing Stablecoin Earnings


Staking Stablecoins


Some platforms, like Binance, allow you to stake stablecoins to earn staking rewards. Staking often involves locking your coins for a set period, but the rewards can be higher than regular interest accounts.


Lending on DeFi Platforms


For tech-savvy investors, lending stablecoins on DeFi platforms can yield higher returns. However, be mindful of risks such as smart contract vulnerabilities and impermanent loss. I didn’t try it myself because of the risks associated to it.


Yield Farming


Yield farming involves depositing your stablecoins into liquidity pools on DeFi platforms like Uniswap or PancakeSwap. In return, you earn rewards in the platform’s native tokens, which can significantly boost your overall returns.


Risks to Consider


While earning interest on stablecoins can be profitable, it’s important to understand the risks:


  • Platform Risk: If a platform becomes insolvent or gets hacked, your funds could be at risk.

  • Regulatory Changes: Governments might impose regulations that impact your ability to earn interest on stablecoins.

  • Smart Contract Risk: In DeFi, bugs or vulnerabilities in smart contracts can result in loss of funds.


Pro Tip: Diversify your stablecoins and platforms to minimize risks. For a deeper dive into the best crypto exchanges, including aspects like security, check out this guide.


Frequently Asked Questions


How Much Can I Earn on Stablecoins?


Earnings vary depending on the platform and your chosen terms. Expect anywhere from 4% to 16% annual percentage yield (APY).


Are My Stablecoins Safe?


Choose reputable platforms with strong security measures. Some centralized platforms offer insurance for your deposits.


Do I Need Technical Knowledge?


Not necessarily. Centralized platforms are user-friendly and ideal for beginners. DeFi platforms may require more technical understanding.


Start Earning Today


Earning interest on stablecoins is a smart way to grow your crypto portfolio without exposing yourself to high market volatility. With numerous platforms offering competitive rates, now is the perfect time to start if you want to have some part of your saved money producing highest yields.


Sign up on these trusted platforms and take advantage of our affiliate bonuses:



Take the first step toward financial freedom and let your stablecoins work for you! Start being your own bank :)

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