Nexo’s homepage claims $12 billion in assets under management for over a million users, making it one of the largest cryptocurrency interest account platforms on the market.
Nexo’s upcoming review will focus on the company’s history, interest account, security measures, and overall analysis of the company’s role in the crypto-currency industry.
Nexo cryptocurrency interest rate account
Users can earn 10% on stables like USDT, USDC, PAX, TUSD, DAI, HUSD and 6% on BTC, BNB, ETH, XRP, LINK, BCH, LTC, TRX, PAXG and XLM if they choose the Earn in Kind option. Earning in kind means that users earn their interest in the base currency; BTC deposits are earned in BTC.
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If users choose to earn on NEXO, Nexo’s native token, their interest rates will increase by a total of 2%.
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What is an NEXO token used for?
NEXO was created during the ICO and distributed to the team and early adopters. The company shares up to 30% of its profits with the owners of NEXO.
The NEXO token is the basis of the ecosystem for loans and deposits; the possession of a token entitles to a 30% share in the profits of the company, as a dividend. Nexo claims to have paid out more than $9 million to token holders since 2018.
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The token also has several benefits for customers with crypto currency interest accounts. When NEXO is pressed and held, users can :
- Earn an extra 2% annually on your deposits by raising the interest rate to 12% and other cryptocurrencies to 8%.
- Borrow 5.9% for Nexo’s direct Crypto lines of credit.
Other crypto-currency interest account platforms have similar tokens: Celsius has CEL, Crypto.com has CRO. They seem to be a way to anchor and encourage early adopters to use the platform and keep the token.
Is the NEXO token a good buy?
NEXO’s total offering is set at 1 billion tokens, with 560 million tokens currently outstanding. The price of the token increased from $0.09 and $0.50 in the first three years, but rose to more than $3.60 in 2021.
This Nexo valuation will not make investment recommendations, but it is interesting to look at the volatility of the token relative to the longevity of the company. The NEXO token was launched shortly after the 2017 bull market, but experienced its strongest growth along with the 2021 bull market.
Whether NEXO is a good buy depends on whether you intend to hold the token for a profit or to increase your average annual return on an interest-bearing account – apart from pure speculation, of course.
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How does Nexo keep its funds safe?
Nexo acts as a custodian of all deposits, which means the company keeps your digital assets. This is done through a partnership with cryptocurrency storage solution BitGo.
In accordance with Nexo’s terms and conditions, the Nexo Wallet services are provided on an as is basis and the Company’s limitations of liability protect it from hacking, tampering or transmission of computer viruses.
These liability limitations are pretty standard among cryptocurrency interest account platforms, as many of them are custodial platforms. However, these companies often work with a specialized solution specifically designed to protect user funds.
For example, BlockFi uses the cryptocurrency exchange Gemini as a repository.
Nexo’s assets are stored in cold wallets protected by multiple signatures, and private keys are stored offline (via BitGo), locked in Class III bank vaults for physical protection. This protection gave the platform some weight in our Nexo test.
Through a partnership with BitGo and Ledger Vault, Nexo’s deposits are insured up to $375 million.
Before you breathe a sigh of relief, consider that Nexo claims $12 billion in assets under management. It’s not known what percentage is kept in the fridge and insured, but mathematically the Nexo insurance would cover about 3% of the fund if all was lost in a doomsday scenario.
It should be noted that cryptocurrency asset insurance is still very new and few if any platforms offer insurance similar to Nexo. That’s why these types of accounts are called crypto-currency interest accounts, and not crypto-currency savings accounts – neither your principal nor your interest is guaranteed.
So your funds are safe on the Nexo? .
Nexo’s security infrastructure is ISO/IEC 27001:2013 certified. So your funds are probably safe on Nexo; deposits are probably just as safe on Nexo as on competitors like BlockFi and Celsius. However, interest rate accounts for cryptocurrencies have a unique set of risks that should not be ignored. Do your research, talk to your licensed financial advisor.
About Nexo: Company profile
Nexo was founded in 2017 by Antoni Trenchev, Georgi Shulev and Kosta Kanchev, three Bulgarian founders with experience working with different financial institutions in Europe. The company is registered in London, England.
Nexo has raised $52.5 million in two rounds of funding from two investors: Arrington XRP Capital and Erhan Bilici. The platform is available in 200 jurisdictions and boasts more than a million clients and $12 billion in assets under management.
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Nexo’s roots are intertwined with another Bulgarian fintech startup, Credissimo, a fast loan company that operates primarily in Europe. The company was previously listed on the Bulgarian Stock Exchange, but was delisted for unconfirmed reasons. A post on Reddit suggests that the founding team, which was recognized as a public company, was too troublesome and bought out the public shareholders to take the company private again.
An initial version of Nexo’s white paper referred to the link with Credissimo, but this has since been removed:
Nexo is powered by Credissimo, a leading FinTech group that has been serving millions of people in Europe for over 10 years. Credissimo has always operated in accordance with the highest regulatory requirements and under the strictest supervision of many European banking and financial services regulators. Today, this same team and its board of directors, backed by Nexo’s growing community of supporters and the huge demand for instant crypto loans, will unlock the value of digital assets in a rapidly growing token economy that will fundamentally change the structure of this $5 trillion market.
Kosta Kanchev is still on the list of board members of the project.
Nexo Legacy ?
Nexo’s longevity in this space has earned the company some recognition as a legitimate pioneer in the cryptocurrency interest account space.
Interest rates on Nexo’s cryptocurrency accounts are competitive with BlockFi, Celsius and Crypto.com.
Nonetheless, Nexo has a notable feature of poor communication and customer service. Several discussions on Reddit and posts on Twitter call for more transparency or management involvement to address customer concerns.
The elephant in the room for Nexo (and frankly, a large portion of cryptocurrency companies) is that it has not released audited financial statements to back up its claims. Dun & Bradstreet claims that Nexo earns $417,555 per year, but that figure seems very low compared to Nexo’s unofficial statistics, which suggest that business is booming for Nexo.
As for Nexo’s audit, it doesn’t appear to be negligence or malice on Nexo’s part – the third party auditing Nexo’s deposits and profits will likely only need partial access to view BitGo’s vault wallets, which are unlikely to be released for routine audits due to security concerns.
Nexo’s security infrastructure is ISO/IEC 27001:2013 certified, meaning the platform has been successfully audited by CISQ, the world’s leading management systems certification provider, and RINA. This review focuses primarily on safety, which is somewhat related to the business measures disclosed by Nexo.
Our review of Nexo shows that, with the exception of a few coverage features, Nexo is a legitimate platform.
Is Nexo safe?
Nexo faces many risks unique to cryptocurrency projects.
- Interest losses on loans in a declining market.
- Recording problems and limitations (Nexo keeps your money).
- The risk associated with stables and the potential loss of their financial commitment for any reason.
- Burglary or other dishonest acts.
However, these are just idle risks that every cryptocurrency interest account faces. To see the full risk analysis, check out our guide to paid crypto currency accounts.
So, can you trust Nexo?
This Nexo review sums up the above points for those inclined to distrust, as default skepticism leads to further investigation. Nexo’s unknown profitability is affecting depositors and holders of NEXO tokens, but the platform has yet to experience any significant problems.
Nexo seems like a solid company, but it would benefit greatly from more management involvement in communications.
CEO Alexey Mashinskiy of Celsius, on the other hand, organizes weekly AMAs and offers master classes on executive engagement and transparency to companies interested in trading cryptocurrencies. When you sign up with Celsius, you will also receive $40 in BTC on your first transfer of $400 or more.
How does Nexo earn money?
Nexo wins on the difference between crypto-currencies and deposits. This is pretty typical of cryptocurrency interest accounts and lending platforms.
Loans in cryptocurrencies may offer interest rates as low as 5.9%, but these rates may rise to pay depositors higher interest rates.
For example, let’s say we are in a bull market. Hypothetically, customers would want to borrow more to buy BTC in hopes of benefiting from higher prices. Borrower-driven demand will lead to higher interest rates.
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Nexo distributes loans based on collateral in cryptocurrencies, allowing users to borrow by securing certain coins as collateral. They can release their coins once they have repaid the loan. Let’s say they deposit BTC to get credit in USDT. When BTC are valued, the value of BTC as collateral also rises, which increases the credit limit and allows users to borrow more money.
is Nexo DeFi?…
By definition, Nexo is not a DeFi project, but a centralized platform that stores your digital assets as you use them. In theory, Nexo can hold deposits and limit withdrawals.
Nexo Registration Bonus
Nexo does not currently offer a sign-up bonus, but we will update our review of Nexo once we do. However, most of his competitors do.
Celsius: Earn $40 in BTC on your first transfer of $400 or more.
Link to the presentation of Celsius
BlockFi : Receive up to $250 (instead of $25) in USDC when you open a new BlockFi account worth at least $500.
Link to BlockFi overview
Crypto.com: Get 25 USD as bonus for signing up at Crypto.com.
Final thoughts: Is Nexo legal and worth your time?
Nexo has a strong presence in the cryptocurrency interest account space. With competitive interest rates on stablecoins, BTC, ETH, other cryptocurrencies and even fiat, this is an option worth exploring for those looking to earn interest on their cryptocurrency. The company has also seen significant growth in its customer base, and its token has a price tag that has gone up more than 7 times, which has probably enabled some very wealthy and lucky early adopters to make their move.
Nexo is a European company. As a result, our European readers may be more familiar with Nexo than the American platform. US readers, on the other hand, may prefer companies that must operate under US regulations and jurisdictions, such as. B. BlockFi and Celsius.
However, tribalism is not necessary when it comes to cryptocurrency interest accounts. Readers may benefit from subscribing to multiple providers of high interest accounts to spread the risks associated with using a single provider.
Our review of Nexo was positive, but we urge management to be more proactive in communicating with the various new communities that are forming around cryptocurrency interest accounts.
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frequently asked questions
Is the Nexo reliable?
Is the Nexo registered in the US?
a jump in credit…
Is Nexo better than Coinbase?
against the foot of the play against nexo.
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