What is Nexo (NEXO)?
Nexo is the native token for the decentralized crypto lending platform of the same name. Nexo is the first cryptocurrency-based loan provider in the blockchain space, bridging the gap between traditional and decentralized finance.
Nexo is a privately owned company that manages cryptocurrency-backed loans using collateral tokens. The platform runs on the Ethereum blockchain and the Nexo token uses the ERC-20 standard. It employs oracles and smart contracts to manage the loans and automate the process. You can take a look at the current Nexo price data above.
Who Developed Nexo?
Nexo was co-founded by Antoni Trenchev, Georgi Shulev, Kosta Kantchev, and Kalin Metodiev. Trenchev is an entrepreneur and the managing partner at Nexo. He served in the National Assembly of Bulgaria. Shulev has extensive experience in traditional banking, having worked with European Investment Bank.
Kantchev is the Executive Chairman at Nexo. He also co-founded the European FinTech group Credissimo. Metodiev is a corporate finance expert with over two decades of market experience.
The project’s vision is to create a FinTech ecosystem that transfers some of the core elements of traditional finance into the DeFi pace. It aims to be the pioneer of digital financial technology by provisioning state-of-the-art, sustainable solutions. The platform officially launched in 2018. The token showed generally low volatility for the first couple of years, with the Nexo price balancing below $0.20.
The market value started to fluctuate more around the first half of 2020. A significant peak was reached in May 2021, when the price nearly reached $4.
Over the years, Nexo has developed a number of high-profile partnerships and affiliations, including Ledger, the BCB Group, and Circle. Furthermore, the company is a member of global organizations like The Bitcoin Foundation, the European FinTech Association, and the International Token Standardization Association.
What Are the Main Features and Functions of Nexo?
The maximum supply of Nexo tokens is limited to 1 billion. This makes the asset deflationary, meaning that the Nexo price is expected to rise as the tokens become more scarce.
The main service offered by the platform is instant crypto-backed lending. The NEXO token is used as collateral for taking out fiat currency and stablecoin loans. If the user chooses to take out a loan with the NEXO coin, they can receive special discounts on their interest rates.
The loans are set up using smart contracts and oracles to ensure financial integrity and security. Users must adhere to Know Your Customer (KYC) practices to use the lending service. Nexo comes with its own hot wallet that can be used to store assets for collateral. From here, the funds are allocated based on the contract.
Users are incentivized to hold NEXO tokens by becoming part of the loyalty program. Alongside the aforementioned interest discounts, token holders are also eligible to earn dividends as a reward for staking. Dividends account for 30% of the company’s profits and are paid using NEXO, ETH, BTC, and USDC.
Although Nexo’s primary mission is to provide cryptocurrency-backed lending services, it offers other DeFi services, including a crypto exchange and direct crypto purchases. Loyalty members are able to withdraw their crypto assets for free. Token holders that use the exchange service can also receive instant cashback.
Among its services, Nexo is the first company to offer a crypto-backed credit card. The Nexo card allows users to spend fiat for providing crypto assets as repayment security. It can be used as any other traditional credit card. Cardholders earn crypto rewards for their transactions.
The Nexo credit card is used to bring traditional and digital finance together by providing holders with both a physical and a virtual card. The app can be used to freeze or unfreeze the account. The Nexo price is not affected by the use of the card.
The credit card does not require you to make minimum monthly repayments or other fees. There are also no applicable foreign transaction fees for up to €20,000 each month. According to the company, users are eligible for 10 free monthly withdrawals.
To ensure the security of the users’ assets, Nexo maintains all assets in cold wallets. The platform strictly follows KYC requirements for both its digital financial services and the crypto credit card. The safety regulations provided for the customers’ satisfaction as well as the low Nexo price may draw a positive trajectory for the asset’s long-term future.
