Nexo is an interesting project that allows crypto asset holders to spend money without having to sell what they own. By transferring their cryptocurrencies to the Nexo wallet, they can almost immediately get a loan in an amount commensurate with the value of their crypto wallet. In this article we would like to explain more about what Nexo is and how it works.
- 1 What is Nexo?
- 2 The Nexo . team
- 3 The partners
- 4 How does the Nexo platform work?
- 5 Receive a loan through the Nexo Oracle
- 6 Earn money with the interest on your crypto
- 7 Pay with the Nexo debit card
- 8 What is the Nexo token (NEXO) used for?
- 9 Nexo Price
- 10 How do I buy Nexo (NEXO)?
- 11 How can I store Nexo?
- 12 Conclusion
What is Nexo?
Nexo is a platform that allows its users to obtain fiat money loans (Euros, Dollars, etc.), with collateral on the crypto assets of the users as collateral. The project was developed by Credissimo, which is a leading fintech group with millions of customers in Europe.
But why wouldn’t you want to convert your crypto coins into fiat money? There are several reasons for this:
- You would like to make more profit through cryptocurrencies, and that is why you always want to have an amount in your crypto wallet.
- When you make a profit, you will have to pay tax on it in the country where you live.
- It takes a few days to transfer your money from a crypto exchange to your bank account.
Nexo has therefore come up with a concept whereby the company will lend fiat money to individuals by taking collateral from the crypto assets of those individuals. The Nexo platform currently offers its services in more than 40 fiat currencies and in more than 200 jurisdictions.
But the platform doesn’t just offer to give you a loan. It also offers you to become a lender. This means that you can borrow cryptocurrencies at an interest rate of up to 10%.
Just like a traditional bank, Nexo allows you to invest in cryptocurrencies for a capital gain of 8% to 12% for stablecoins . So you can grow your cryptocurrencies in the same way as in a savings account.
The Nexo . team
Nexo’s development team is partly related to the team behind Credissimo, as they are the same company. Nexo is the special version for cryptocurrencies. Credissimo has 130 employees and has had a working product for 10 years. They are fully regulated and supervised by the European financial services regulators.
These are Nexo’s key team members:
- Kosta Kantchev (co-founder). Kosta is one of the co-founders of Credissimo and is partly responsible for the success of the past 10 years.
- Antoni Trenchev (co-founder). He has been involved in the development of e-commerce platforms and was CIO at Credissimo.
- Vasil Petrov (CTO). Vasil has 16 years of experience in IT system management, back-end development and project development. He co-founded a company that broadcast videos and provided Internet services to more than 150,000 people.
It is extremely important that a company’s team consists of the right people. When a team does not have the necessary experience, the chance of failure is many times greater. However, it is also not entirely unimportant that a crypto project has the right partners. By working with the right partners, a project can strengthen its position many times over. These are Nexo’s main partners:
- BitGo . This is a company evolving in blockchain security and in the creation of wallets, which provides them with the Nexo wallet.
- Ledger . Ledger is a French company that designs and sells physical cryptocurrency wallets.
- True USD . This is a stablecoin operated by TrustToken, which is a platform that converts tangible assets into tokens.
- Securitize . Securitize is a platform and protocol that provides protection for blockchain. It does the same for Nexo’s blockchain.
- jumio .This is a mobile payment company that also offers online identity verification. It also helps Nexo with this, and therefore also contributes to the security of the platform.
- circle . You might know it, because Circle is a company that offers peer-to-peer payment technology.
- brave . Source’s open source web browser with the special feature that it advocates the protection of the privacy of its users.
- Huobi Global . This is a cryptocurrency exchange platform.
- Terra . This is a blockchain protocol that uses fiat-based stablecoins.
- ITSA . This is an organization that works to introduce standards in the cryptocurrency market to ensure optimal security. It is only too happy to work with Nexo.
How does the Nexo platform work?
Before you decide to invest in Nexo, you naturally want to know how it works. It is important to know how a blockchain/crypto project works before investing in it. Of course you want the price of the crypto coin to rise in the future, so that you can earn money with this.
Receive a loan through the Nexo Oracle
Crypto asset holders who want to access fiat money without selling cryptocurrency can take advantage of the loan service that Nexo has set up with its solution called ‘Nexo Oracle’.
The Nexo Oracle is an independent system that takes care of setting up loans, monitoring repayments, sending automatic notifications to customers, analyzing users’ crypto assets and maintaining the wallet in real time. That’s a whole laundry list of functions!
As explained in the project’s whitepaper, the first step to receiving a loan is to transfer one’s crypto assets to a specific Nexo wallet. Once the funds are transferred to it, the Nexo Oracle will automatically calculate the amount of loan that the user can get based on the value of his crypto assets.
From that moment on, the money is immediately available to the user. He can transfer it to his bank account or spend it with the Nexo debit card (we’ll tell you more about this later).
The user’s crypto assets will be locked in the Nexo wallet until the loan amount is fully repaid.
To repay the loan, a user has several options:
- Using Fiat money by making a bank transfer.
- Repay the loan amount with the NEXO token. If the user chooses this option, he will receive a discount on the interest to be paid.
- Paying part of the crypto assets that are in the Nexo wallet.
- If a customer does not pay their installments on time, Nexo can refund by automatically withdrawing the crypto assets from the customer’s Nexo wallet.
Earn money with the interest on your crypto
Depositing cryptocurrencies or fiat currencies on the Nexo platform allows you to grow them by investing them like in a bank savings account. Thanks to this investment, you gain access to a much more interesting interest rate than at a bank such as ING, ABN AMRO or Rabobank.
For the transfer of the cryptocurrencies on the platform, the processing will take place within a few minutes. If you want to transfer your fiat currencies, you can do so directly from your bank account and it will take between one and three business days.
Once you have placed your assets in your Nexo wallet, you can start earning interest the very next day. The interest is deposited daily into your Nexo wallet. So you don’t have to do anything further for it. The blockchain does all the work.
Interest rates will of course vary based on the cryptocurrencies or currencies you have invested. The NEXO token is the thing that will bring you the most interesting rate of 30% profit.
Pay with the Nexo debit card
Nexo also offers its users a physical bank card. The latter works thanks to Mastercard and allows its users to spend their cryptocurrencies in the manner of a credit.
With this bank card, money can be borrowed whose guarantee is based on the available assets in the linked wallet. It is therefore not possible to spend money if you do not have it at your disposal. In this way, Nexo wants to cover the risk that users will not be able to pay back their borrowed money to the platform.
Thus, the user receives notifications on his Nexo application and the available credit balance is confirmed in real time. In addition, unlike traditional bank cards, users do not have to pay monthly or annual fees or pay exchange fees when using them.
Nexo is therefore going to compete with Crypto.com and Binance . Both also have their own payment card. However, these two have a much bigger name, which means that the reach they have is a lot bigger. Because Nexo is still relatively new and unknown, the future will show how this will turn out for Nexo.
What is the Nexo token (NEXO) used for?
Of course you can think that you can use NEXO to make money. When you sell the token for a higher price than the purchase price, you can make a nice profit. However, the Nexo token offers more options than just serving as a means of payment. Here are the different benefits of holding NEXO coins:
- Nexo offers dividends to its token holders. The tokens make it possible, relative to the tokens held, to share 30% of the profits generated by Nexo thanks to the interest rates charged on the loans.
- Lower interest rates for people who repay their loans with the token.
How do I buy Nexo (NEXO)?
There are several ways to buy Nexo. You can do this at a major central exchange such as Binance and Bitvavo . We also recommend that, because you always experience the benefits of high liquidity here. So you can buy and sell NEXO at any time. In addition, these exchanges are also a lot safer than smaller exchanges for DEXs.
It is also possible to buy NEXO on a decentralized exchange (DEX). This can be Uniswap , Sushsiswap or Pancakeswap . It is a lot more difficult to buy NEXO here, because you will have to go through many more steps. That is why there is a much greater chance that something will go wrong when purchasing from NEXO. So choose Binance or Bitvavo.
How can I store Nexo?
The safest way to store Nexo tokens is to use a hardware wallet . These are electronic wallets in the form of USB sticks. The two best known are the Ledger Nano X and the Trezor. These are also the safest, and for sale for the best price.
Since the Nexo is an ERC-20 token, it is also possible to store NEXOs in online wallets such as MetaMask. This is therefore a lot less secure than a hardware wallet. That is why we also recommend that you use a hardware wallet if you do not want to use the Nexo wallet.
Because in order to take advantage of the services that Nexo offers, you have to store your tokens on the Nexo platform by creating a wallet. In order to take advantage of the 30% dividend offered to token holders, you need to perform an additional KYC (identity check) procedure. So keep this in mind when you buy Nexo and want to save it in the Nexo wallet.
Nexo thus allows users to spend money without having to sell what they own. By transferring money to the Nexo wallet, they can almost immediately get a loan in an amount commensurate with the value of their crypto wallet.
For those who do not want a loan, the NEXO token will allow them to receive dividends from the profits generated by the company up to 30%. So that’s a good return.
The project was initiated by Credissimo, a company that has been active in the retail credit sector in Europe for over ten years. Therefore, the team has a very good experience in the field.
However, there are a few negatives to the project. The interest rates offered to the borrowers are relatively high and even though Nexo is a pioneer in this field, many competitors that have entered the market more recently have proved more interesting, such as Aave for example .
Since 2020, decentralized finance (DeFi) has been a topic that has been widely developed. Many projects have been born out of this general enthusiasm for this new way of approaching bank lending.
Thanh Lanh Tran(1989) is Chief Editor from BitcoinUSD.com