The Swyftx cryptocurrency exchange, one of Australia’s largest, has just launched a fee-flexible, yield-bearing offering called ‘Earn’ on various cryptos. It’s something it hopes will help break it into the financial mainstream.

And this makes it the first Aussie-operated crypto exchange to make such a service available to its users – without any lock-in periods.

“Very few global exchanges are offering crypto users the level of interest rates that we are without also having lock-in periods,” said Swyftx Chief Executive Officer Ryan Parsons, adding:

“Australia has among the highest levels of crypto adoption in the world and you’re going to see this translate into service offerings that are hyper-competitive.”

Interest on up to 21 different digital assets will be made available to Australian and New Zealand residents, including Bitcoin (BTC), Ethereum (ETH), Cardano (ADA), Solana (SOL) and major stablecoins such as USDT and USDC.


Cool, but how competitive is the yield?

Very, according to Parsons: “We’re looking at significant pockets of traditional finance and thinking ‘you know what, we can out-compete you.”

So in actual terms, we’re talking interest rates of up to 6.7% on stablecoins, with other assets such as Bitcoin and Ethereum being able to attract a shade over 5%. It’s also offering up to 5.3% on TAUD (True AUD, Australian Stablecoin).

Yeah, those aren’t the levels of yield that can be typically earned from DeFi (decentralised finance) – which can, generally speaking, offer at least twice as much.

But this is a centralised crypto entity, bringing different benefits such as ease of use and less risk attached. And, as Parsons suggests, its rates definitely outgun “TradFi”.

Slightly more risk-on crypto assets, such as Polkadot (DOT), will actually offer higher returns through Earn, though. We’re talking about 12.7%, according to Swyftx. And there’s even potentially a much higher rate for the DeFi protocol token KAVA – reportedly up to 25.8%.


What does no lock-in actually mean?

According to the info on this shared with Stockhead, Swyftx’s Earn feature works by “flipping the traditional lending model on its head”, with customers converting fiat into crypto and then lending those digital assets back to the platform in return for interest.

Not being locked in means that investors will be able to withdraw funds from Earn at any time, with no exit fees or notice period. That kind of fee-free flexibility is apparently one of the exchange’s main differentiators in the global exchange-based yield-offering market.

And that’s enabled because, according to Swyftx, the feature operates as an “at call” loan between individual customers and the exchange. It means Swyftx is obligated to pay back customer loans, along with any interest at the relevant rate, when customers choose to withdraw their assets.

Swyftx notes, however, that the feature is not covered by the Australian Government’s Financial Claim Scheme and rates are variable.

“Over the next two to five years, we expect Earn and other crypto innovations to totally transform the way Australians and other nationalities choose to diversify and manage their wealth,” said Parsons.  

“Our expectation is that you’ll start to see many more Aussies using crypto wealth services as they become more familiar with digital assets,” he concluded.