Bulgarian decentralized lending platform Nexo has unveiled a crypto-powered debit and credit Mastercard for citizens of the European Economic Area (EEA).
According to the Aug. 31 announcement, the Nexo Card will allow users to spend their euro, U.S. dollar, and British pound stablecoins via debit transactions at over 100 million merchant terminals worldwide. Up to 9% in annual interest will reportedly be paid to stored balances.
Meanwhile, the Nexo Card’s credit transactions use major cryptocurrencies, such as Bitcoin (BTC), as collateral, offering up to 2% cash back and interest rates of 16% per annum on used credit lines. Both debit and credit transactions directly convert users’ crypto to fiat money when used at terminals. Nexo claims that custodied assets are insured by Ledger and Bakkt.
The firm also says that the new Nexo Card has no monthly or inactivity fees, no foreign exchange fees for up to 20,000 euros ($21,700) per month, and a limit of 10,000 euros ($10,800) in monthly ATM withdrawals. Upon passing Know Your Customer verification checks, a virtual card and a physical card will be issued; both can connect to Apple Pay and Google Pay. The card is only available to citizens of the 30-country EEA.
Earlier this year, Nexo’s corporate offices in Sofia were raided by Bulgarian police over allegations of violating sanctions and Anti-Money Laundering laws against Russia. The firm said it plans to sue the Bulgarian government for damages relating to the incident. Due to issues with the local government, Nexo does not provide services to residents in Bulgaria.
A spokesperson for Nexo reached out to Cointelegraph after publication with the following statement:
"Nexo operates the most rigorous know-your-customer (KYC) and anti-money laundering (AML) standards. In addition to the protocols followed by traditional financial institutions, Nexo collaborates with leading firms like Chainalysis, whose services are trusted by agencies such as the FBI and the CIA. Our team of specialists, certified in the US for anti-money laundering measures, confidently trace the origins of crypto assets entering our platform and monitor the destinations of funds withdrawn."
"In light of the conflict in Ukraine and the ensuing sanctions against Russia, Nexo swiftly established some of the most stringent policies concerning sanctioned regions and individuals, in response to Russian actions. Furthermore, we were among the first to mobilize support and raise funds for the affected victims."
The spokesperson also claims that "the allegations leveled by the Prosecutor's office against Nexo have not been substantiated in any manner as numerous Bulgarian institutions have confirmed Nexo's lack of wrongdoing."
The future of #crypto payments is here.— Nexo (@Nexo) August 31, 2023
Introducing the world-first Dual Mode of our pioneering Nexo @Mastercard, featuring both credit and debit capabilities.
Experience the ease of debit coupled with the power of credit, earn rewards, and spend your way. pic.twitter.com/FuHNUrSRNO
Update September 2 2023 6:07PM UTC : This article has been updated with statements from a Nexo spokesperson.