Occasionally there’s a gem in the late night phone doom scrolling. This popped up as I was headed to bed, and actually made me lose sleep because I felt the need to look into it further. I’m a fan of the “free” element of matching. I’m particularly a fan when the restrictions about that mean I keep easy access to my money. This feels like there’s some real value here, particularly if you have any cash sitting idle.
While OKX is one of the large and growing crypto players in the US (and globally), there remains a sketch factor that anyone should consider when moving any amount of money anywhere (even to legitimate, highly regulated banks!) Don’t play with money you can’t afford to lose.
The promotion – link
- Match – “You’ll need to opt-in and deposit cash or crypto worth at least $1,000 to get a 5% deposit match. You’ll get a deposit match for every eligible deposit made during the offer period, up to a maximum reward amount of $2,500 USDG. If you deposit less than $1,000 before the offer period ends, you won’t be eligible for a deposit match. For example, if you deposit $1,200 you’ll get 60 USDG. If you deposit more than $50,000, you’ll get $2,500 USDG.”
- Timing – “Once you make eligible deposits worth $1,000-$50,000 during the offer period, your rewards will be calculated and paid out every 2 weeks. To receive the maximum reward amount, you’ll need to maintain your net deposits over the rewards payout period. If you make a withdrawal during the rewards payout period, it will impact rewards from upcoming payouts, and you may not get rewarded.”
- Restrictions – Requires opting in. Excludes existing balances. Transfers/withdrawals remove funds from promotion consideration. The T&C’s are full of legalize, but it sounds like the funds can be used to hold in stable coins like USDG, and as such you can double dip with any deposits (the match + standard return).
The math
Let’s use a hypothetical example here of $10,000 deposits. There are two core components here: 1) the match OKX provides, 2) the rate of return for holding those deposited funds in a USDC currency
- The Match: $10,000 x 5% = $500. This $500 will be deposited weekly for 24 weeks so long as the balance remains above $10,000. $500/24 = $20.83/week; 5%/24*52=10.8% annual rate of return. Not bad in and of itself.
- USDC Earn Rate: 5% APY on deposited funds. $231 total return over the 24 week period. This also is deposited weekly. $10,000 x 0.05 / 52 = $9.62/week. $9.62 * 24 = $231 total return. $231/10,000 / 24 * 52 = 5.00% annual rate of return.
- Combined: Assuming one fully optimizes, deposits only for the required 24 weeks, this translates to ($9.62 + $20.83) = $30.45 * 24 = $730.80 on $10,000 in deposits, or 7.31% absolute (24-week period only), 15.8% annual rate of return. Hot damn that’s a good deal.
In reality, one will not fully optimize this. They’ll be off a day or two. But even if you’re off a week, or a month, you’ve still got a pretty killer rate of return for a cash-like transaction.
The truth is, I’m probably going to throw an inappropriate amount of money at this, because EVEN IF I’m borrowing money for this 24-week period (which I’m not planning on doing), the annualized rate of return is just so damn high. For me, it’s worth a little risk for money I would have otherwise sitting in cash or high yield savings accounts.
Obligatory post-ending gif.
