Nexo: The Crypto Bank
Disclaimer: Your capital is at risk. This is not investment advice.
Token Takeaway: NEXO;
Originally launched as a centralised lending protocol, Nexo has evolved into a comprehensive platform providing various crypto services such as crypto credit cards, purchasing, swapping and trading. Despite the inherent risks and controversies associated with centralised crypto lending, Nexo has demonstrated resilience and reliability over time. This Token Takeaway will delve into the core workings of Nexo, examine the risks in the sector, and assess the value proposition of Nexo's native token, NEXO.
Overview
Nexo was launched in 2018 by Antoni Trenchev, Georgi Shulev, Kalin Metodiev, and Kosta Kantchev to address inefficiencies in the crypto lending market. The platform was initially backed by XRP Arrington Capital and Connectico Capital, raising $52m in March 2018. Today, it has grown to become a prominent centralised crypto lending platform with over 6 million registered users across more than 200 jurisdictions.
In addition to its core crypto lending services, Nexo has expanded its offerings to include various professional financial services, such as savings accounts and fixed deposits tailored for the digital asset space, effectively positioning itself as a banking solution for crypto assets. This approach aligns with the broader trend of bridging traditional finance with crypto by providing users with access to financial services that are typically associated with traditional banks but adapted for the world of digital assets.
While Nexo may appear interesting, the centralised crypto lending sector is fraught with risk and controversy, as evidenced by the collapses of prominent platforms like Voyager, BlockFi, and Celsius, resulting in significant losses for customers and tarnishing the reputation of crypto lending. These companies have faced lawsuits from US agencies, including allegations of securities fraud, misleading customers, and market manipulation. Nexo has also had its fair share of hiccups, but it has endured extreme bear markets and the collapse of its counterparts, making it the leading centralised crypto lending platform.
