Crypto lender Nexo has issued a press release concerning the enforcement actions it’s going through from eight totally different states pertaining to its Earn Curiosity Product (EIP).
Earlier this week, state regulators in California, New York, Washington, Kentucky, Vermont, South Carolina, Maryland and Oklahoma made allegations that Nexo was violating securities legal guidelines with EIP.
In a brand new weblog publish, Nexo says it has all the time aimed to be a sustainable and compliant enterprise.
“We now have been working with US federal and state regulators and perceive their urge, given the present market turmoil and bankruptcies of corporations providing comparable merchandise, to meet their mandates of investor safety by analyzing previous habits of suppliers of earn curiosity merchandise.”
The agency says it not accommodates new US accounts and balances for EIP for the reason that U.S. Securities and Alternate Fee (SEC) made its stance on crypto lending platforms’ interest-bearing accounts.
“For the reason that SEC steerage on earn merchandise, dubbed ‘The BlockFi Order’ in February 2022, Nexo has voluntarily ceased the onboarding of recent US shoppers for our Earn Curiosity Product in addition to stopped the product for brand spanking new balances for current shoppers.”
The agency additionally responds to criticisms that it might offer unrealistically excessive rates of interest for its shoppers. Nexo clarifies that it solely provides 36% curiosity on Axie Infinity (AXS), which presently has a 60% staking reward, however offers decrease, single-digit curiosity for nearly all of the others.
“Our charges for the overwhelming majority of the property are within the single-digit percentages. On the subject of the most well-liked property, together with Bitcoin, Ethereum, and stablecoins, we provide stability limits, the place clients earn a decrease yield above sure quantities.
Our charges are all the time decided with the underlying sustainability of our enterprise and safety of buyer property in thoughts. An summary of the newest modifications to our Earn Curiosity Product is on the market right here the place it’s proven that rates of interest for Bitcoin, for instance, are nominal and fluctuate between 1.5% and seven%.
We do pay rates of interest as excessive as 36% for one asset solely, Axie Infinity’s AXS the place the present staking reward is sort of 60%. This charge, nevertheless, is an exception, and we don’t promote the share in our advertising and marketing supplies.”
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