Last Updated on February 15, 2024 by Ben
Linus Review
If you’re searching for a high-yield savings account that converts your deposits into cryptocurrency, Linus is the one to go with. Linus offers a higher APY than standard accounts, and there are no fees associated with it. It’s also simple to handle your Linus account on your own; Linus does not require any minimum balances or monthly contributions to get started.
What is Linus?
What is Linus?
Linus Financial is a high-yield savings account provider. That implies they are not under the supervision of a bank or insured by the FDIC.
To put it another way, consider this account as a venture capital fund rather than a typical savings account — there is more potential for loss than with a regular bank.
What Do They Offer?
Investment in blockchain technology is at an all-time high. The issue is that it takes some know-how and technological savvy to invest on your own. Linus’ role comes in here.
Linus is a service that allows you to profit from the advantages of cryptocurrency investment without requiring any effort. You may get up to 4.5 percent APY on your savings account if you make a $500 initial deposit with Linus.
In terms of interest rates, a typical savings account pays out around 0.08 percent APY.
So, how does Linus produce such an impressive yield? They convert your money into cryptocurrency.
When you deposit cash into your Linus account, it is tokenized and converted into USDC, a stable coin cryptocurrency. USDC is backed one-to-one by real dollars.
Your money can now acquire an interest in digital capital markets without depreciating in value if you store it in an e-wallet.
All of this activity happens behind the scenes. You may make deposits and withdrawals in dollars just like you would with a typical savings account if you use Linus as an investor.
How Does it Work?
That’s the key question — how does Linus manage to earn a whopping 4% APY on a savings account? That rate is unrivaled among large brick-and-mortar banks. In fact, no savings account can compete with it. CIT Bank currently offers the highest-paying savings account at 0.40 percent APY.
Linus is not a savings account, and it’s critical to recognize that. A regular savings account is one provided by a bank or a fintech that sits on top of the bank’s services. Linus does not fall into either of those categories. Linus is not similar to a traditional bank account. Linus cannot guarantee that your money will be secure. I’ll get to that later.
Let’s discuss the technology underpinning Linus. You are more like an investor than a depositor as a Linus customer. Linus can’t promise you anything with regards to the safety of your money.
Linus converts your USD to USDC. USDC is a cryptocurrency, but it is not the only one. The term “stablecoin” refers to a type of financial instrument that aims to keep its value stable over time. It’s linked to the dollar and is backed by real assets. One USDC equals $1. Why go through all of that work, and how does it relate to high-yield savings?
Linus also utilizes Ethereum’s blockchain contract technology, another digital currency and set of blockchain algorithms. Linus is a member of the Bitcoin community. Linus is also working with Ethereum-based blockchain credit markets.
It then becomes accessible to digital capital markets once Linus converts your USD to USDC. Again, Linus has not provided details about these markets. In terms of transparency, this is a negative. Any bank would be required to supply that information back to the subject at hand. People can borrow your USDC. Of course, interest is paid on loan. We may infer that Linus is calculating the spread (the distance between the interest and savings rates).
Linus has avoided loan defaulters in these digital credit markets by what method? Linus is utilizing a market that requires borrowers to put up collateral that is worth more than the amount of the loan. If everything goes according to plan, Linus has protected its investment (i.e., the saver’s).
Linus minimizes risk in the following manner. Loans they are involved with are fully collateralized, whether by way of a token or other cryptocurrency. Linus also has an undisclosed amount of reserve set aside depending on deposits.
Pros & Cons
Pros
- High-yield savings — over 4% APY
- There are no fees to open or manage your account.
- Minimal maintenance required
- There’s no need to study or understand cryptocurrency.
Cons
- There is no insurance to speak of, and if you lose your money in an economic crash, it will not be recovered.
- APY is changing and can go down over time.
Fee Breakdown
Linus has some disadvantages, but they are not as serious as other platforms. Linus does come with hidden fees, though.
There are no fees involved in establishing or running your Linus account. It is entirely up to you how much money you want to put in and take out after the initial $500 deposit.
There are no minimum balance requirements, withdrawal fees, or term restrictions.
Linus is a trustworthy and straightforward investment firm. While your money will not be protected from a major economic crisis, it will be safe from hidden costs.
Linus is still working hard to bring in more people as a young firm. That means it’s an excellent moment to open an account — they’re giving a $20 bonus with your first deposit right now.
Linus also offers special incentives to help you increase your account. You may earn a $20 bonus after each person you refer signs up for Linus.
Transferring Money
Your bank’s debit card may be used to deposit cash into your Linus account. You can also use ACH to transfer money in and out of your account.
There is no such thing as a monthly transfer limit. However, keep in mind that your Linus account isn’t a checking account and shouldn’t be treated as one. Funds in your Linus account may not be accessible right away. Unlike a CD, your money is not kept locked in your Linus account.
How Do You Sign Up For An Account?
Are you ready to begin Linus? Creating an account is quick, free, and simple. Here is a step-by-step process to get you started.
- Initial signup: Go to Linus’ website and click “Sign Up.” All you have to do now is type your name and email address to begin. Then, you may log in to your dashboard and get acquainted with the platform.
- Confirm your identity: Linus will need a little more information after you’ve decided to deposit. They’ll want your government identification card and a photo of you using the computer’s camera.
- Check your email: Linus will send you an email when your identity is confirmed — this usually takes less than 15 minutes. To complete your account registration, click the link in the email.
- Make your first deposit: Linus Bank also enables you to link your bank account in order to make an ACH transfer into your new Linus bank account. You may also establish recurring deposits to help you keep track of your savings.
Conclusion
Linus is a high-risk, high reward option for those who are looking to invest in the stock market. You have real risks and could lose some or all of your money if you don’t do it right. But if you know what you’re doing, then this can be a great opportunity to earn large returns with relatively small investments.