Nexo Agrees to Pay $45 Million in Penalties to US SEC and NASAA

Nexo Agrees to Pay $45 Million in Penalties to US SEC and NASAA

Nexo stated that the agreement was made on a "no-admit-no-deny basis.”

Nexo, a crypto borrowing and lending platform established in 2017, has reached a settlement with the US Securities and Exchange Commission (SEC) and the North American Securities Administrators Association (NASAA).

According to the press release shared by SEC on January 19th, Nexo has agreed to pay $45 million in penalties. The Securities and Exchange Commission blamed Nexo for illegally selling and offering its “retail crypto asset lending product, the Earn Interest Product (EIP).”

Did you know?

Want to get smarter & wealthier with crypto?

Subscribe - We publish new crypto explainer videos every week!

What is Shiba Inu Coin? (Explained with Animations)

What is Shiba Inu Coin? (Explained with Animations) What is Shiba Inu Coin? (Explained with Animations)

Nexo is set to pay a $22.5 million penalty and stop selling its EIP. Moreover, Nexo has reportedly agreed to pay an additional $22.5 million to “settle similar charges by state regulatory authorities.”

Crypto lender issued a separate statement on January 19th. In the blog post, the company highlighted that it has cooperated with US authorities since day one.

Moreover, Nexo distinguished that the settlement does not mean that the crypto lender is guilty of wrongdoing. Based on Nexo, the agreement was reached on a “no-admit-no-deny basis.”

In its press release, the Securities and Exchange Commission did not deny that Nexo complied with the regulators. After SEC announced its charges, Nexo allegedly voluntarily stopped offering the EIP to new customers and ceased paying interest

However, the Director of the SEC’s Division of Enforcement, Gurbir S. Grewal, was quite strict regarding the matter. Grewal claimed that regardless of what “labels” companies put on offerings if products constitute securities, firms have to comply with existing securities laws.

On the other hand, Nexo Co-Founder Antoni Trenchev felt relieved that the settlement was reached and Nexo can leave the United States.

We are content with this unified resolution which unequivocally puts an end to all speculations around Nexo’s relations to the United States. We can now focus on what we do best - build seamless financial solutions for our worldwide audience.

In December, Nexo announced its plans to stop providing its services in the United States.

Gile K. - Crypto Analyst

by Gile K. - Crypto Analyst, BitDegree