Uphold Launches U.S. Dollar Interest Accounts

Uphold, a trading platform with about 12 million users, is launching U.S. dollar interest accounts that can earn an APY of up to 5%.

The company’s CEO, Simon McLoughlin, stated that this initiative is designed to attract new customers and encourage users to hold more capital on the platform.
“Our main goal is just to make Uphold attractive and acquire a ton of new customers, from the mass market,” McLoughlin told The Block. “It’s also just a safer way for people to hold dollars on the platform. It’s an insured vehicle.”

Initially, the offering is only available to U.S. users, and the accounts provide access to FDIC insurance up to $2.5 million for participating funds. Balances under $1,000 will earn 2% interest, while balances exceeding $1,000 earn 5%.

As of now, Uphold has over 2 million users in the U.S.

The interest accounts paying up to 5% APY result from a partnership with Atomic Brokerage. “We’re not funding it,” McLoughlin clarified. “The yield is not generated from our balance sheet.”

Instead, Uphold will provide this attractive APY through a program named Atomic Cash Sweep.
“Through Cash Sweep, clients’ funds are deposited into an interest-bearing deposit account at one or more banks, where the funds earn a variable interest rate and are eligible for FDIC insurance coverage,” Uphold explained.

McLoughlin mentioned that the rollout of these new USD interest accounts was prompted by customer demand for higher yields. “Users tell us that they want more ways to maximize the earning potential of their assets, whether that is crypto or fiat,” he stated. “Now we are the first major crypto trading platform to embed a brokerage account offering interest on USD.”,