Nexo Starts Letting Investors Earn 6.5% Interest on 5 Stablecoins

  • Nexo (NEXO), a Switzerland-based startup that provides “instant” crypto-backed loans, has announced that it will start paying interest on five different stablecoins.
  • These include Paxos Standard Token (PAX), USDC, TrueUSD, USDT, and Dai.

Nexo (NEXO), a Zug, Switzerland-based startup that provides “instant” cryptocurrency-backed loans, has announced that it will start paying interest in five different stablecoins.

Established in 2017 and having received $52.5 million in total funding to date, the Nexo lending platform reportedly offers 6.5% interest, compounded annually and “paid out daily,” on Dai, Paxos Standard Token (PAX), Circle’s (USDC), Tether (USDT), and TrueUSD (TUSD). According to Nexo’s management team, the interest payouts to users are fully automated and are available for all Nexo wallets.

Borrowing "Instantly" In 45 Different Fiat Currencies

There are “no minimum amounts” or additional service fees and there’s insurance on certain packages “of up to $100 million.” As noted by Nexo through its official Twitter account, the company plans to add support for more assets in the future.

According to Nexo’s website, the company also offers a credit line on most major cryptocurrencies including Bitcoin, Ether, Binance Coin (BNB), XRP, Monero (XMR), among others. As explained on Nexo’s website, the fintech firm “has an insured [crypto] wallet that lets users borrow instantly in 45+ fiat currencies” while accruing interest on “idle assets.”

Notably, Nexo has partnered with BitGo, a leading Palo Alto, California-based crypto security platform that provides “multi-signature security-as-a-service solutions”. BitGo is reportedly acting as a custodian for Nexo as it’s securing all cryptoassets for the crypto startup. As stated on Nexo’s website, BitGo is “insured by Lloyd’s,” which provides one of the world’s largest insurance and reinsurance markets.

Moreover, BitGo is also backed by giant Wall Street investment bank, Goldman Sachs and is Cryptocurrency Security Standard (CCSS) Level 3 compliant. This means that “multiple [verified] actors [are required] for the all-critical actions, as advanced authentication mechanisms are employed to ensure the authenticity of data, while assets are distributed geographically and organizationally.”

Additionally, BitGo’s custodian services are SOC 2 compliant, which is essentially a standardized auditing procedure that “ensures your service providers securely manage your data to protect the interests of your organization and the privacy of its clients.”

BlockFi Also Offering Interest Payments For Cryptos

As CryptGlobe reported on March 20, BlockFi Lending LLC, a New York-based “secured non-bank lender” that also offers crypto-backed loans in USD to cryptoasset investors, announced that its interest-yielding deposit accounts received more than $25 million in cryptocurrency. This, only two weeks after the official launch of its lending platform.

As noted by Zac Prince, BlockFi’s CEO, the firm’s terms of service have been created to allow it to operate in a flexible manner. Prince added that BlockFi is able to decide, for the most part, how it intends to use depositors’ crypto funds and it can also determine how much in interest payments it will pay them during a given time period. This, Prince explained, was necessary as the company is presently working on further expanding its operations.

BlockFi provides two different lending products, which include crypto-backed loans and crypto-funded interest-generating accounts. The New York-based firm’s loans-based product lets users borrow in USD for a one year period at a 4.5% interest rate while depositing bitcoin, ether, and/or litecoin as collateral. Currently, users can only borrow up to 50% of what they’ve put up as collateral.

Amounts Over 25 BTC/500 ETH Will Only Receive 2% Interest On Funds Above Threshold

Notably, only a few weeks after launch, BlockFi has already decreased the interest rate paid out to its account holders. Effective as of April 1 of this year, accounts with over 25 BTC or 500 ETH will only receive 2% on the funds deposited above the maximum threshold. Initially, BlockFi’s contracts had offered investors 6% in interest payments on similar packages.

In an email sent to CoinDesk, BlockFi's CEO claimed:

Due to the demand for our product, we’re making a few changes to our product pricing that will affect your account starting in April.

Weekly Newsletter

Bitcoin Below $10K: Crypto Analyst PlanB Says 'Ignore the Noise, Focus on the Signal'

Siamak Masnavi

On Monday (February 17), as Bitcoin continued its fall below $10,000, popular pseudonymous analyst "PlanB" (@100trillionUSD) advised his followers on Twitter to keep their eyes on the big picture.

Bitcoin didn't have a great weekend.

According to data from CryptoCompare, Bitcoin started the weekend at $10,343, and ended it at $9,872, as you can see in the price-chart below:

BTC-USD 2 Week Chart on 17 Feb 2020.png

For holders of Bitcoin, the pain continued on Monday. By around 14:00, when PlanB took to Twitter, Bitcoin had fallen to $9,609:

BTC-USD 24 Hour Chart on 17 Feb 2020.png

This is when PlanB told his Twitter followers to "ignore the noise" and "focus on the signal":

In a Medium blog post published on 19 March 2019, PlanB talked about scarcity in terms of the stock-to-flow (SF) ratio -- where stock is "the size of the existing stockpiles or reserves" and flow is "the yearly production" -- and used this to model Bitcoin's value.

He wrote:

The predicted market value for bitcoin after May 2020 halving is $1trn, which translates in a bitcoin price of $55,000. That is quite spectacular. I guess time will tell and we will probably know one or two years after the halving, in 2020 or 2021.

In a tweet sent out last Monday, PlanB said that he expected the price of Bitcoin to be over $10K by the next block mining reward halving (expected on 12 May 2020), at which point he expects the major bull run to start, taking the Bitcoin price all the way to $100K before the end of 2021:

 

Featured Image by "geralt" via Pixabay.com