Risks of BLOX Earn

What is Earn?

Crypto Earn involves lending your cryptocurrencies (cryptos) to others in exchange for a fee (in the form of returns). This is similar to the way traditional loans work. However, there are some differences. You do not receive your return in euros, but in the same crypto you lent out. For example, if you lent Bitcoin and receive a 1% return on it, you will receive the return in Bitcoin.

While Earn is a way to earn extra returns on your crypto, it - like any form of investing - also carries risks. The party lending your crypto will use it for different purposes, and this may affect the security of your lent assets. Therefore, it is important to understand the risks well before you decide to lend your crypto.

What are the risks of Earn?

It is common knowledge that there are risks involved in receiving returns. This also applies to lending your cryptos. For instance, the person (or party) lending the cryptos may not be able to repay this loan or pay the promised returns. You run the risk of losing your lent cryptos (or part of them). It is therefore important to consider whether crypto Earn suits you and whether you can and want to bear any losses. It is also important to fully understand crypto Earn's terms and conditions.

How does Earn at BLOX work?

As a BLOX user, you decide whether and which cryptos you want to lend out. You arrange this easily via ‘Earn’ in the BLOX app or browser. Important: When you decide to lend crypto, you enter into a lending agreement with BLOX, the party lending your crypto.

The premise is that you will receive periodic (weekly) returns from BLOX in the form of the respective lent crypto (or cryptos). You can find the current rate of return on our platform. There may be changes to this from time to time. These are actively shared with you. You can decide to stop lending your crypto at any time. You can easily change this in the app or browser.

Note: when you indicate that you want to lend out a specific crypto, all coins will be lent out. Even if you buy new coins with Earn enabled, these will also be lent out. The same applies to your Earn returns.

What does BLOX undertake to mitigate the risks as best as possible?

BLOX performs several checks to minimise the risks of crypto lending. These include assessing the creditworthiness of borrowers, continuous monitoring to identify risks early and diversification of counterparties. Additional measures are also taken, and procedures for recovering assets in case of default or insolvency.

BLOX can deploy your crypto in various ways to generate returns. This can be by on-lending the crypto to carefully selected parties, as well as by discontinuing it or having it discontinued, or by lending the crypto to BLOX for liquidity purposes. With each choice, careful research is done on the parties involved and the associated risks, so that your crypto is managed in the best possible way.