“Insolvency, bankruptcy is nowhere in Nexo’s reality”: Co-founders
Speculation about crypto lender Nexo heading for bankruptcy was squashed by the company’s top-ranking members.
In an “Ask-Me-Anything” YouTube video on Tuesday, Nexo co-founders Antoni Trenchev and Kalin Metodiev addressed a series of inquiries, in which a participant asked if their lending platform could be the next Celsius Network Ltd. or Voyager Digital Ltd., both of which filed for bankruptcy earlier this year.
Metodiev replied: “Insolvency, bankruptcy is nowhere in Nexo’s reality.”
He added, “We are working very hard to deliver a very strong and sustainable future for our users for many years to come, enriched with a range of additional services and products through the integration of technology and disruption of existing services.”
After that, Trenchev reiterated a similar opinion, saying that the company had “no exposure to the Terra and Luna debacle”. He also pointed out that Nexo has not lent to the bankrupt crypto hedge fund Three Arrows Capital.
The Switzerland-based crypto-lending platform is instead headed for expansion into industries such as trading as well as the development of wealth and asset management solutions in traditional capital markets, the two co-founders said.
In recent months, Nexo has also positioned itself as a potential acquirer of ailing cryptocurrency companies. In August, Nexo approved a $50 million buyback program. Nexo had previously carried out a buyback of 100 million dollars in May.
Still, Nexo was called out by regulators from eight US states last month for offering interest-earning accounts without registering the investment products as securities. Following this, Nexo had to fight a cease and desist order filed by regulators from California, Kentucky, Maryland, New York, Oklahoma, South Carolina, Vermont and Washington.
Nexo’s yield accounts were marketed and used by private investors.
In another development last month, Nexo announced it was taking a stake in Wyoming-based Summit National Bank, expanding its footprint in the US region.
Nexo has taken a stake in the US federally chartered bank regulated by the Office of the Comptroller of the Currency by buying a stake in Hulett Bancorp. Hulett Bancorp is a holding company that controls Summit National Bank.
Specific terms of the agreement were not made public. The company emphasized that the mutually beneficial impact the share acquisition will have on the customers of both companies should be the focal point of the deal rather than the size of the deal.
The company said Nexo will announce more plans in the coming months to expand its new customers in the US and expand its addressable market in the country.
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