The Winklevoss’ bitcoin exchange is pushing into banking with a new savings product – CNBC

The Winklevoss’ bitcoin exchange is pushing into banking with a new savings product – CNBC

Cameron (L) and Tyler (R) Winklevoss.

Adam Jeffery | CNBC

Gemini, the cryptocurrency exchange founded by Tyler and Cameron Winklevoss, is launching a savings scheme for its U.S. users.

From Tuesday, the Gemini app will add a new service called “Earn” that lets clients move their holdings in cryptocurrencies like bitcoin, ether and litecoin into interest-bearing accounts.

Gemini says it will offer rates of up to 7.4% APY (annual percentage yield). For comparison, that’s more than 100 times the national average of 0.05% on savings accounts in the U.S.

“This product is available for all 26 cryptos that Gemini supports,” Noah Perlman, Gemini’s COO told CNBC in an interview. “And it’s the only cryptocurrency exchange that offers the opportunity for users to earn crypto in every state in the U.S., including New York.”

Gemini is a New York trust company regulated by the New York State Department of Financial Services. The company says it’s able to offer such high rates by lending out crypto to institutional borrowers through its lending partner, Genesis Global Capital, in exchange for interest payment. Deposits aren’t protected by the Federal Deposit Insurance Corporation, and rates are adjustable based on supply and demand.

The savings program will only be available to U.S. clients, not those in international markets like Canada and Britain. Gemini rolled out its services in the U.K. last year, after obtaining an electronic money license from the Financial Conduct Authority.