Instant Crypto Credit Line Provider Says It Processed $300 Million in Seven Months
A crypto lender that offers consumers an instant credit line says it has processed more than $300 million in seven months, making a net profit of $3 million.
A crypto lender offering instant loans in more than 45 fiat currencies says it has amassed more than 170,000 users — with $300 million processed over a seven-month period.
Nexo enables consumers to deposit their crypto assets into a secure wallet and instantly access a flexible credit line via automated approval and without the need for credit checks. They can then spend this credit by card or withdraw it to a bank account with a same-day or next-day transfer without incurring hidden fees or foreign exchange commissions.
The platform says its interest rates, which are deducted directly from a user’s available credit limit, start at an 8 percent annual percentage rate (APR) — with the company arguing that this is “much lower than the average credit card rate.” Repayments on loans are flexible and have no minimum requirements, and they can be completed at any time without subjecting additional costs.
Nexo has been featured on CV VC’s list of the 50 most important Swiss blockchain companies, and it says it is the only crypto lender that makes loans available to more than 200 jurisdictions around the world.
According to Nexo, the “ravaging bear market” in the crypto world has not affected its performance, with the company earning a net profit of $3 million within the first seven months of its operation. As reported by Cointelegraph at the start of the year, lenders have enjoyed buoyant demand because borrowers have been reluctant to sell their assets when prices are depressed.
Back in December, the company paid a dividend of $912,071 to holders of its native NEXO token, representing 30 percent of the profits made. Nexo claims that the 4.80 percent annualized yield is higher than all of the dividend-bearing stocks in Warren Buffett’s portfolio — including big names such as Apple, JPMorgan Chase and Goldman Sachs. This comes despite Buffett’s ongoing skepticism about cryptocurrencies in general, with the billionaire investor recently describing Bitcoin as a “delusion” that has no unique value at all.
To underline why these financial results are important — with its business turning a profit, let alone being operational – Nexo cites research from Ernst & Young, which suggests that only 13 percent of the companies that conducted initial coin offerings in 2017 actually have a working product, with 71 percent have no offering on the market at all. The firm adds: “Typically, within one year of a traditional venture-backed software startup, you would expect to see a significantly higher percentage of the companies with a functional early stage product.”
Insured and secure
According to Nexo, all of the crypto assets that it holds for users are insured against third-party hacks, copying, theft of private keys, insider theft or dishonest acts of employees. This custody insurance coverage compensates clients for losses of up to $100 million in the event of a security breach. Nexo has taken out an enterprise-solution policy offered by BitGo (backed by Goldman Sachs) and provided by Lloyd’s.
The company also says that it is a founding member of the Collateral Protection Insurance consortium, which ensures that borrowers are fully compensated if the assets they provide are destroyed, stolen or rendered unavailable.
Nexo has been backed by Michael Arrington, the founder of TechCrunch, with Arrington XRP Capital investing “substantial amounts” into the project. The company says that its website has now received more than 1 billion impressions — attracting 35,000 members in its Telegram community, along with more than 31,000 followers on Twitter. The crypto lender has also been featured by renowned business publications and news services, including Forbes, Bloomberg and Reuters.
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