Has anyone done this just to earn the APY?
I am considering it as it seems the safest way to earn interest on BTC, however, my main worry is that they may prevent withdrawals without getting all kinds of crazy info about you. If the Feds ever attack Bitcoin, then expect the exchanges to become frozen IMO.
Any opinions on this?
Although I trust Bitcoinica, I don't trust the Feds, so at present I keep no funds with Bitcoinica. Which sucks b/c earning interest in a deflationary currency is pretty sweet.
When we announced the Terms of Service, we left our users two options:
- Agree and continue trading
- Disagree and withdraw all funds
We didn't force you to accept something before you are able to take your funds out.
When we implement compulsory KYC procedures, we will follow the same rules.
Also, Bitcoinica's interest system is not a ponzi scheme. Our interest rates are set based on outstanding positions and user balances. All payouts are from the swaps that we charge from positions. Currently, the Open Interest is almost 90,000 BTC, so there are a lot of swaps to be collected and distributed (over $200 everyday).