Whatever happened to the "be your own bank"? Why would I need a checking account when I have crypto? https://www.cnbc.com/2022/09/27/cry...us-bank-charter-through-acquisition-deal.html Cryptocurrency lender Nexo said it has agreed to buy an undisclosed stake in Hulett Bancorp, which owns a little-known bank called Summit National Bank. Through Summit National Bank, Nexo plans to offer a range of products including checking accounts and crypto-backed loans. Nexo’s bank license will bring users enhanced legal safeguards and help it expand its footprint in the U.S., the company said.
Pretty good discussion on their business model. They will be bankrupt in a year, mark my word: Dirt-Purple We arent sure, infact thats the "business model" of these scams - get people to put in their actual cash (big bad fiat) into these shady exchanges/lending platforms, and then they lend it out to entities that are way below sub-prime The average crypto bro doesnt understand any of this, they see 12% interest on stables, they jump in. The companies like NEXO lend it out to fraudsters, criminals who cant get a regular loan from a bank. When banks are giving out loans to businesses for 5-6% rates, why would anyone borrow from NEXO or Celsius or Voyager or BlockFi for 15%, so that these lenders can keep 5% and give creditors 10%? Only those who cant get a loan from a bank i.e. those with piss poor credit profiles The crypto lending model exists to obfuscate the fact that people's money is being siphoned off to shady entities via loans. If an average creditor knows their money is being used to fund a $1.5m loan to buy a stupid age JPEG, they would run away. So the lender takes their money and siphons it away while being opaque about it. Its really not surprising that this business model fell apart at the first sign of tightening macro - celsius, blockfi, voyager all got rekt, and NEXO does too except its registered in a shady EU country and can lie about it unlike Celsius and Voyager which are US entities ----------- Nexo takes money from its depositors (Creditors) and then lends it out to third party borrowers , who then buy such shitty NFTs "ART" Here, Nexo plays an intermediary that just issues loans to buy extremely risky assets without any credit checks. Nexo (as well as any other crypto lender like celsius/blockfi) operate illegal security schemes - thats why they are already banned across most of US, and many regulators are suing them. They dont let users know the risks these platforms take to generate the returns. The article says "Crypto lender Nexo provided the ETH at an annualized interest rate of 18%." This means Nexo is counting on the company that borrowed from them to pay 18% on the borrowed about. If someone takes a business loan (such as a loan to fund say a new car dealership), the lender (bank) can expect operational income from the business to fund the interest and servicing costs. In an NFT loan, how exactly is the NFT gonna generate 18%? Its just vapour
https://cointelegraph.com/news/nexo-offices-reportedly-raided-by-police-in-bulgaria Troubled cryptocurrency lender Nexo is facing more pressure from regulators, with its offices reportedly raided as part of an international investigation. A group of prosecutors, investigators and foreign agents searched the company’s offices in the Bulgarian capital city of Sofia, local news agency Standart reported on Jan. 12. The operation was reportedly initiated a few months ago, targeting a large-scale financial criminal scheme allegedly involving money laundering and violations of international sanctions against Russia. Citing sources the Bulgarian National Television, the report alleges Nexo’s involvement in the scheme. ----------------------- Founded in 2018, Nexo operates a cryptocurrency investment platform, also allowing users to stake and borrow against crypto. The firm first encountered issues in the United States in 2022, with the California Department of Financial Protection & Innovation filing a desist-and-refrain order against it regarding its interest service in September.
I have always avoided anything to do with Nexo.io I can't really critique it much, since I never did my research, but they certainly spammed all the media with their ads. Some of their returns they boasted seemed far more higher than what most load return rates should be, hence I never trusted them. To each their own.