21bitcoin Now Pays Europeans 1.21% Interest on Euros in Bitcoin

Bitcoin app 21bitcoin has launched a feature that pays customers in Germany and Austria 1.21% annual interest on their idle euro balances, with the option to receive that interest in bitcoin.

How the Bitcoin Bonus works

The product, called the Bitcoin Bonus, is aimed at euros that users have already deposited for upcoming savings plan purchases or for limit orders waiting on a target price.

Interest is calculated daily and credited at the start of the following month after tax, and users can choose to have it automatically converted into sats with no conversion fee.

The balance stays available for purchases and withdrawals at all times, there is no fixed term, and the rate is variable.

21bitcoin explained the reasoning in its announcement:

“This balance already has a purpose. With the Bitcoin Bonus, it gains an additional benefit: as long as it sits in your 21bitcoin account, it can earn interest once activated.”

Interest that can cover trading fees

The company pitched the interest as a way to offset the cost of buying bitcoin.

It wrote:

“Depending on your average balance, holding period, and purchase volume, your interest credits can partially or fully offset any purchase fees.”

In its example, a €10,000 average balance held for one year earns €121 before tax, or €89.09 after Germany’s 26.375% tax deduction.