SoFi targets idle crypto cash with interest-bearing tokenized deposit
· CNA · JoinRead a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST Tap here to return to FAST
FAST
Oct 22 : SoFi Technologies on Thursday launched a "tokenized deposit" product that lets customers earn interest on cash set aside for crypto purchases, while offering protections similar to those of a traditional bank deposit.
Cash held in a SoFi Earn account will generate 4.2 per cent annual interest and be insured by the Federal Deposit Insurance Corporation, which protects eligible deposits of up to $250,000 per depositor if a bank fails.
"Too much money in the digital asset ecosystem is sitting idle, leaving massive potential earnings on the table for millions of people," SoFi CEO Anthony Noto told Reuters.
The product moves SoFi into a space historically dominated by non-bank crypto firms. In recent years, funds earmarked for crypto trading were often parked in interest-bearing stablecoins, giving investors a way to earn yield while keeping money ready to deploy.
CNA Games
Guess Word
Crack the word, one row at a time
Buzzword
Create words using the given letters
Mini Sudoku
Tiny puzzle, mighty brain teaser
Mini Crossword
Small grid, big challenge
Word Search
Spot as many words as you can
Show More
Show Less
That model has come under pressure after the GENIUS Act, signed last year, barred stablecoin issuers from paying interest, creating an opening for banks to offer regulated, interest-bearing alternatives through products such as tokenized deposits.
SoFi Earn will also let users buy crypto directly or transfer funds to another platform.
"The primary opportunity is with people who already participate in crypto and want that money to keep working and ready to move," Noto said.
Traditional financial institutions are developing products to tap the crypto market, arguing that bank-issued alternatives offer greater regulatory oversight than stablecoins issued by non-bank entities.
In September, a group of 21 financial institutions including Goldman Sachs, Bank of America, Citi and Deutsche Bank, said they planned to create a company this year to issue a dollar-pegged cryptocurrency in the first half of 2027.
"Over the next year or so, you're going to see an inflection point. It is a big effort to move traditional finance on chain, but I think the economic drivers are just so powerful that it's inevitable," said Sam MacPherson, CEO at digital asset finance firm Spark.
Newsletter
Week in Review
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
Sign up for our newsletters
Get our pick of top stories and thought-provoking articles in your inbox
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app