How does a bank make money? Simply put, they take deposits from you and give that money as loan to borrowers. You get interest on your money and the borrower pays interest to banks on the loan. The difference between these interests, minus the bank’s expenses is the PROFIT.
I know we blame the banks and call them evil. There are many scams happening within the banking sector. We see Blockchain as our saving grace and cryptocurrency as a means to earn money. But everyone has a savings/salary/current/loan/credit card account with a bank and its necessary for day-to-day operations.
Banks are important and cryptocurrencies seem to be a good instrument to make money from. Indian exchange Bitbns combined the banking model with a cryptocurrency exchange to let hodlers earn more money.
Earning Interest on Cryptocurrency
Bitbns announced they will be paying 20% interest if you hold your cryptocurrency in their special account BHE – BitBns Hodl and Earn.
How Does it work?
The current plan offered by BitBns is a long term plan for 1 Year. You have to Hodl your cryptocurrency for 1 whole year with Bitbns to earn 20% interest. If you invest 100 ETH, at the end of one year you will receive 120 ETH.
You cannot cancel the contract before one year, the conversation on telegram with Prashant revealed. Prashant Singh is the co-founder of BitBns.
How will BitBns Benefit?
Go back to our banking example to know the answer to this question. BitBns and many such exchanges are struggling to get volume on their platform. Our best guess is that Bitbns will use these funds to increase liquidity or spend them on improving the platform. Bitbns has not revealed any more details regarding the use of these funds. It is anyone’s guess.
Can this be an April Fool’s Prank?
Oh yes, tis that time of the year when corporations set out to “fool” their users with elaborate videos, announcements and schemes. This also works great as marketing campaign and to collect user data like emails and contact details on their “New” launch.
BitBns may not be an exception. The announcement is on medium while the registrations are taken on a google form with absolutely no checks. I gave April-fool as my phone number and it was accepted.
You can clearly see that these forms were built in super hurry. This acceptance message says you can click a link and edit your info, but there is no link. Another red flag is asking the question ‘I want to opt for BHE account’, a user will fill the form to open the account, why ask that again? Guess no one audited the form or the post.
The medium article is written poorly. A quote below from the article mentions a Datta, who is working on the initiative. There is no Datta in Bitbns Team. Notice the grammatical mistakes in it?
We see lot of users just hold there cryptocurrency for long terms gains. But cryptocurrency market is quite volatile in nature & so we want our users to earn. Why only hold when you can earn interest for holding” Says Datta, who has been working on this initiative.
There seems to be nothing about this post that convinces me that the initiative is real. I would love be wrong but for now, we have to wait 2 more days.
What do you think about the Bitbns Hodl and Earn offer? Let us know in the comments below.