Nexo (NEXO) represents the native crypto-asset of the eponymous lending platform. When exploring the world of cryptocurrencies, one encounters assets with such varied histories! On one side, there are tokens created simply to be full-fledged virtual currencies; there are tokens launched to profit from hype, sometimes originating as a joke, and there are cryptos launched to meet a specific need. Nexo (NEXO) unquestionably belongs to the latter category. To push its services, Nexo needed a native cryptocurrency. Tokize provides a review of Nexo to give a comprehensive analysis of this cryptocurrency.
What Is Nexo (NEXO)?
Nexo (NEXO) is among cryptocurrencies that can be classified as native tokens. Native tokens are directly derived from the functioning of a platform. They owe their existence solely to the services offered by the platform; they come into play to facilitate the provision of services. The Nexo cryptocurrency precisely fulfills such a function. Its existence is attributed to the crypto lending services provided by the Nexo platform.
Nexo blockchain is Ethereum. Nexo is a token built on Ethereum’s ERC-20 standard. As the native token of Nexo, it allows users to access the platform’s services and benefit from certain advantages. Due to the quality of its offerings and the level of satisfaction it has provided to its users, Nexo crypto lending company has established the credibility of its native token NEXO. Consequently, it now positions itself beyond the role of a mere token fueling the services of the lending platform. Nexo (NEXO) is available through various exchanges.
History of Nexo (NEXO)
NEXO crypto stands out as a flagship asset among DeFi (decentralized finance) cryptocurrencies. It owes this status notably to the rapid growth of the Nexo crypto lending platform and the profile of its founders.
Who Founded Nexo?
There are two versions when it comes to discussing Nexo’s journey. Both versions nonetheless mention ties to Credissimo, a European fintech group offering various types of loans, financing for e-commerce activities, startup capital, etc., to businesses and individuals.
Nexo’s activities started with an official launch in 2017, followed by $52.5 million in funding in April 2018 through a private sale of NEXO tokens. One theory suggests that Nexo was launched by Credissimo itself.
According to the second theory, the Nexo platform was established by Antoni Trenchev, Kalin Metodiev, and Kosta Kanchev, with Kosta Kanchev being one of the founders of Credissimo.
Entry of Nexo Into the Crypto Market and Its Evolution
In any case, the team that launched Nexo owes much to Credissimo. The initial workforce of the crypto lending platform consisted of former employees of Credissimo. Consistently working to improve its offerings since its inception in 2018, Nexo has developed several innovative products and services. They attracted over 6,000,000 users in more than 200 jurisdictions.
This reputation has allowed Nexo (NEXO) to expand beyond the utility role on the Nexo platform. NEXO tokens have become genuine investment assets, listed on exchanges such as Huobi (since March 2019) or Binance (since April 2022).
Unfortunately, in January 2023, legal actions taken against Nexo founders dealt a blow to the credibility of the platform and NEXO cryptocurrency.
Why was Nexo (NEXO) Created?
The creation of the NEXO cryptocurrency is attributed to the need for the platform to have an internal token. This token would facilitate the payment for services and various benefits on the platform. NEXO tokens therefore simplify interactions and currency exchanges between the platform and its users or clients. But concretely, what does this cryptocurrency bring?
Traditionally, to obtain loans, applicants are constrained to provide collateral, mortgage assets, etc. Meanwhile, among crypto investors, any expenditure to be financed with tokens or coins usually requires selling them. NEXO addresses these two problems. When users buy tokens on the Nexo platform, they can request loans in fiat currencies or stablecoins, using their Nexo tokens as collateral.
By opting for this solution, they gain access to lower interest rates. The platform also provides a debit card loaded with NEXO tokens. This crypto card allows users to make purchases without selling their cryptos. These same tokens allow Nexo users to save and earn interest. The platform pays interest in NEXO and several supported cryptocurrencies. The crypto lending platform also offers a card for making purchases with owned cryptocurrencies. It then provides cashback (in NEXO tokens) for purchases made with the card.
How Does the Nexo Token Work?
The utility of NEXO tokens is first examined in terms of their nature. These tokens operate on the Ethereum ERC-20 network, ensuring their decentralized nature and therefore their reliability. Additionally, holding NEXO tokens requires having an ERC-20 wallet. The total supply of Nexo is 1 billion NEXO tokens. As of December 2023, approximately 560 million NEXO tokens are in circulation, accounting for 56% of the total supply. Funds on Nexo are protected by Ledger Vault, which insures digital assets for up to $150 million through a customized insurance program backed by Arch and Marsh according to Nexo.
NEXO for Loans
In addition to being a crypto lending platform, Nexo also operates as a cryptocurrency exchange. Over 60 cryptocurrencies are available for purchase through Nexo. You can acquire any of these cryptos and then convert them into NEXO tokens. NEXO tokens can also be purchased directly. After acquiring these native tokens, users can use them as collateral for loans.
The amounts lent by the platform are determined so that the loan amount / total asset value ratio ranges from 20% to 90%. Users freely choose the duration of the crypto loan and the repayment method. NEXO token holders generally benefit from reduced transaction fees.
Nexo platform rewards users who convert all or part of their assets into NEXO tokens. Each day, the platform rewards them with profits in NEXO tokens. The Nexo card also provides access to rewards. For every purchase made with this card, the user receives a cashback of up to 2% of the amount spent. Investors also earn with the Nexo staking program.
NEXO Tokens as an Investment Asset Outside Nexo Ecosystem
The native NEXO token has now become a crypto in which third parties not using Nexo services can invest. The token issuance occurs in line with the demand for Nexo’s DeFi products. However, these issued tokens also trade outside the Nexo ecosystem.
Where to Buy Nexo (NEXO)?
Nexo initially serves as a utility asset for benefiting from DeFi products. It serves as a utility token for crypto loans, savings, or cashback. However, you also have the option of holding NEXO crypto for investment purposes only. Here are some options for buying Nexo.
Uniswap (UNI) is a decentralized exchange that allows you to swap ERC-20 tokens. Purchasing tokens on Uniswap, which functions like an automated market maker (AMM), provides transparency. Your trade takes place without intermediaries. To buy NEXO tokens, you simply need to connect Uniswap to your Ethereum wallet, such as MyEther Wallet. Then specify the amount of NEXO to exchange with another cryptocurrency like ETH.
The Nexo app is the official platform to buy the token. By visiting it, you have the option to purchase tokens using other cryptocurrencies you already own or by using your credit card. With the user-friendly interface of the platform, you can easily make your NEXO purchase. By buying tokens on Nexo, you can enjoy several offers and other rewards as we explained.
Huobi is one of the few exchanges listed on a stock exchange since 2018. It is listed in Hong Kong and was created in 2013. This centralized exchange allows you to buy Nexo as well as hundreds of other cryptocurrencies. To make the most of Huobi’s features, ensure you complete your registration. After creating your Huobi account, go through the identity verification process. You can then deposit funds to trade NEXO pairs like (NEXO/BTC, NEXO/USDT, etc.).
These three platforms are good options for buying Nexo. The official Nexo platform has the main advantages. You can obtain loans, receive rewards on your purchases with a Nexo card, receive daily dividends, etc. Whenever you wish, you are free to transfer your NEXO tokens to another platform.
What about Nexo’s future? Before purchasing NEXO or any other crypto, it is essential to consider its credibility and the standing of the project supporting it. Nexo had an auspicious start. Its rapid evolution and expansion beyond Nexo have won over more than one skeptic.
Nevertheless, Nexo engages in a sensitive activity: crypto lending. In July 2022, the renowned American company Celsius, operating in the same segment, went bankrupt. A few months later, following this bankruptcy and the scandal involving the FTX platform, Nexo users withdrew over $150 million. In early January 2023, an investor filed a complaint against Nexo company.
Several newspapers then revealed that two of the Bulgarian founders were on the run. These events are not reassuring. In this context, any investment decision on Nexo must be made with caution.
That being said, it should be noted that cryptocurrency has transformed into an investment asset, capable of evolving solely based on supply and demand. Thus, even if Nexo experiences an outcome similar to Celsius, which is still hypothetical, it would not necessarily imply the crash of NEXO price USD. The Nexo chart shows that it started at $0.18 per token in 2018 and reached its ATH of $3.93 in May 2021. NEXO to USD is trading at around $0.84 right now.
Will Nexo go up, is it a good time to invest? Only if you believe in the future of crypto lending platforms. In any case, you must keep a close eye on Nexo’s news and the developments in its legal case, especially with U.S. jurisdictions.
Nexo Pros and Cons
Strong growth potential
Our Final Opinion on Nexo (NEXO)
Being in a highly competitive sector, Nexo has managed to establish itself through innovative products. The founders’ experience has undoubtedly played a key role in the process! The offerings of reduced-rate loans, valued savings, and cashback on the use of the crypto card have attracted many crypto enthusiasts and investors.
The fact that the company has been able to extend its native crypto NEXO outside the platform represents a significant success. As an asset, NEXO could certainly be worth investing in! However, the rumors and legal cases can bring a lot of volatility to its native token price.
If you want to invest in Nexo out of conviction and because you sense an opportunity, exercise caution. Your investment must remain within the limit of what you can afford to lose.
FAQ - Frequently Asked Questions about Nexo
Who is behind Nexo?
Nexo was founded by former members of Credissimo. The links with this fintech company are not clearly established.
Is Nexo Reliable?
Nexo holds a $250 million insurance fund on the assets it holds. The platform also complies with various regulatory standards. However, the Nexo token is not immune to a collapse, given the uncertain nature of the crypto market.
Will NEXO Value Rise Again?
Regarding Nexo forecast, some analysts envision the stabilization of NEXO tokens above $2 in a 3-year horizon. However, there is no absolute certainty about NEXO predictions and the crypto’s ability to rise. Events related to the platform will be decisive.
Where to Buy Nexo?
You can buy NEXO tokens on the parent platform and through AMMs like Uniswap. Some centralized exchanges have also included Nexo among the cryptocurrencies available for purchase.
How to Buy Nexo?
You can purchase NEXO tokens with a credit card or by exchanging them for other cryptos. On centralized exchanges, you will need to open an account first.
How to Use Nexo?
To benefit from the advantages of Nexo, you must purchase it on the Nexo platform. Then, save your NEXO tokens, make purchases with your Nexo card, etc., to earn rewards.
EN Robert Balmes est analyste financier depuis 2013. Il est expert dans les marchés actions, le Forex et les cryptomonnaies. Il participe à l’élaboration d’articles de fond sur des sites spécialisés comme Tokize.com.