Nexo to exit the U.S. market

The crypto-lending platform Nexo announced a ‘gradual scaling back’ of its operations in the United States due to regulatory pressure.

The company’s representatives described the step as ‘sad but necessary’:

“Our decision was taken after more than 18 months of good-faith dialogue with regulators at national and state levels. Despite their inconsistent, evolving positions, Nexo has continually pursued significant changes to the business.”

For example, the firm has closed access to the platform for users in New York and Vermont, and limited the use of the Earn product by U.S. residents.

As part of our cooperative approach with regulators, during the course of 2021 and 2022, we have off-boarded clients from the states of New York and Vermont and have suspended new registrations for all US clients for our Earn Interest Product to meet regulators’ expectations. 4/8

— Nexo (@Nexo) December 5, 2022

Everything became completely clear after the Consumer Financial Protection Bureau (CFPB) decision last Thursday. It states that the agency has authority to study the use of our Earn product, which, as was insisted by the SEC and state regulators, is a security, — according to Nexo’s blog.

Similarly, another crypto-lending platform — BlockFi had to pay $100 million in fines to settle a dispute with the SEC and state financial regulators. The company also ceased providing US residents with services related to the BIA accounts.

Subsequently BlockFi launched savings accounts for accredited investors. However, soon, in the wake of the FTX crisis, the platform suspended withdrawals, and then filed for bankruptcy.

In November, users filed a lawsuit against Nexo over assets valued at around £107m.

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