Authorities alleged that customers of the crypto lender nexo capital were engaging in illegal activities, prompting the securities and exchange commission (sec) to charge nexo capital with the sale of unregistered securities. in 2018, nexo launched a british digital asset platform that loans out client funds and pays interest to those who use their “earn interest” product. multiple u.s. states had filed cease-and-desist orders against nexo, claiming the product was an unregistered security.
Took a stake in u.s. federally chartered bank summit national bank, located in wyoming, and agreed to a settlement with the sec and state regulators in december 2022, wherein they would cease offering the interest program and pay a total penalty of $45 million. global regulators increased their enforcement of crypto firms in the wake of multiple collapses, leading to nexo announcing they would wind down their u.s. operations.
U.s. federal regulators did not accuse nexo of any fraudulent or misleading business practices, but rather emphasized that crypto assets are not exempt from the federal securities laws and compliance with the sec’s public policies is not a choice. nexo agreed to the settlement and has stated that it is on a no-admit-no-deny basis, ceasing their unregistered lending product to all u.s. investors. antoni trenchev, co-founder of nexo, expressed his contentment with the unified resolution and nexo looks forward to focusing on what it does best: providing seamless financial solutions for its worldwide audience.