How to make hodling worthwhile, explained

By storing your cryptocurrency holdings with a lending service, you can make your digital assets work for you.

For years now, the message to crypto enthusiasts has been constant: Hodl.

But if crypto is left to languish in a cold wallet for several years, it can also end up being an unrewarding one. Sure, you can see huge gains, such as Bitcoin’s jump from $30,000 to $60,000 in the first six weeks of 2021. But, there can also be long declines, like the crypto winter of 2017-2018, when BTC dropped from more than $20,000 to less than $4,000 — and it took almost three years for the digital asset’s value to rise back to that level once again.

There’s also a downside to letting Bitcoin, Ether and altcoins languish away in cold storage: Although their value may rise, they don’t end up working for the investor. We’re seeing a very similar situation in the fiat world right now, where interest rates remain at record lows across many major economies. This is catastrophic news for savers — they are actually losing money to inflation — and sadly, it doesn’t seem like there’s going to be a meaningful interest rate rise any time soon.

But there are ways that crypto enthusiasts can ensure their digital assets are working for them. In recent years, there has been an explosion in the number of companies that offer interest on virtual currencies. These centralized platforms connect crypto savers with people who are looking to borrow assets — paying interest in return.