The renowned crypto lending firm Nexo has taken the decision to phase out all of its products and services within the US market. The decision comes under effect due to the lack of any regulatory clarity within the country. Apart from phasing out its products and services, the firm would no longer accept any new registrations. Furthermore, all operations for already existing customers would eventually be stopped as well.
Today we are announcing the regrettable but necessary decision that Nexo will be phasing out its products and services in the United States due to a lack of regulatory clarity. 🧵
— Nexo (@Nexo) December 5, 2022
Nexo plans to wind everything up within the US over the course of the upcoming few months. Furthermore, the firm even stated that departing from the US market is regrettable but a necessary decision. The attempted regulation and scrutiny of the crypto space by US authorities have caused a massive disruption in the sector. This is a clear example of how ignorance on the part of the authorities can affect an industry with the potential to create thousands of jobs and generate millions of dollars.
It is worth mentioning that Nexo has more than 5 million users in approximately 200 jurisdictions from all around the globe. The firm currently holds approximately $2.6 billion in customer liabilities, and its assets are actually greater than the liabilities. Back in September this year, regulators hailing from eight different US states claimed that Nexo engaged in offering interest-earning accounts without registering all possible investment products as securities.
Nexo Makes Up its Mind!
The firm is a Cayman Islands corporation that was established back in 2018. State regulators believe that Nexo Financial LLC is a Delaware Limited liability organization that operates mainly from London. Recently, Nexo clearly mentioned that it had zero net exposure to both FTX as well as Alameda. All of the firm’s digital assets were sold by its teams approximately two to three days prior to FTX seeking bankruptcy protection.
Nexo’s decision to wind up its business in the US market is pretty much final. The organization took it to Twitter and expressed its own take on the situation. The firm makes it clear that its decision comes after being in touch with state regulators over the time frame of 18 months. Keeping its continuously changing positions in mind, Nexo engaged in continuous efforts to modify its business depending on its requirements.
The firm also mentioned that its Earn Interest product would no longer be available in 8 US states. However, users in different jurisdictions would still have access until further notice. Payment specialists of the firm would ensure that customers have access to their assets without any interruption.