Following the US Securities and Exchange Commission (SEC) accusing crypto lending platform Blockfi of failing to register its retail crypto lending product and fining the company $100 million , crypto lender Nexo has announced that it will no longer allow US citizens to earn interest on new savings wallet top-ups. However, Nexo customers in the United States will continue to earn interest on current savings portfolio balances held prior to the announcement.
Nexo “Reveals Big Savings News for US Customers”
Last week, the SEC cracked down on crypto lending platform Blockfi and the company was fined $100 million. The news followed several regulators from a myriad of states like New Jersey, Kentucky, Texas, Alabama and Vermont warning Blockfi about the company’s interest-bearing accounts.
Some states issued cease and desist orders and the company had to stop offering Blockfi Interest Accounts (BIA) on a certain date. After Blockfi’s sanctions were handed down by the US securities regulator, crypto lending firm Nexo announced: “important news for US customers”.
According to Reddit moderator of the r/nexo subreddit, Nexo Josh, US-based Nexo customers will see new changes to the interest-bearing Nexo savings program. Nexo Josh explained that the company had “voluntarily implemented changes” to its product of interest in the United States in order to “comply with recently announced guidelines”.
The Nexo representative noted that non-US customers “are not subject to SEC guidelines and are not affected.” Existing US customers will continue to earn on balances they hold, however, US customers cannot earn interest on newly added balances.
“New refills for your [Nexo] The Savings Wallet, effective immediately, will not earn interest until the Interest Product is restructured,” Nexo Josh’s post said. Furthermore, the representative pointed out that “all assets withdrawn from your savings wallet, even if returned later, will be treated as new top-ups and will not earn you interest.”
Crypto Lender Nexo hopes to launch 2.0 product to earn interest
For new US-based Nexo customers, the earned interest product will not exist in its current form. Nexo plans to restructure the product and it will be presented as version 2.0 of the product of interest. “Our team and legal advisors are working tirelessly to develop solutions for our US clients that will make Product of Interest 2.0 as widely accessible as possible and compliant with new regulatory realities,” Nexo Josh concluded.
Meanwhile, Blockfi wasn’t the only crypto firm targeted by US securities regulators, as Kentucky and Alabama issued warnings to crypto credit firm Celsius over accounts. bearing interest. According to the SEC’s current opinion, the US regulator says crypto savings products that offer interest “are not as safe as bank or credit union deposits.”
What do you think of Nexo’s voluntary implementation of changes to its interest-bearing account products to comply with US regulators? Let us know what you think about this topic in the comments section below.
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