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What is Nexo (NEXO) All About?

Updated: Dec 20, 2019

Nexo is a popular blockchain-based overdraft system that allows its users to take instant crypto loans. The primary benefit of using this platform is that there is no capital gains tax, hidden fees, or credit checks. NEXO is the dividend-paying, US-SEC compliant token, which is backed by the assets in Nexo’s loan portfolio. It is an ERC-20 interest-bearing security token that helps fuel the entire network.

This guide will talk about what Nexo is designed for, the creators behind it, the way it works and various uses and applications.

What Is Nexo Designed For?

Presently, there is no other way for users to utilize their crypto assets, other than buying or selling them. Nexo has come forth with a highly lucrative model, where it allows owners to use their holdings as collateral to withdraw cash. The users of Nexo get to maintain complete access and control over their cryptocurrency while having immediate access to cash loans. They can also access the value of their crypto assets at the same time.

Nexo was designed to be the world’s first instant crypto loan system. It’s a highly innovative business model, created to provide its clients with a flexible, automatic, and cost-efficient means of obtaining liquidity, effectively through the value of digital assets.

Who Is the Team Behind Nexo?

Nexo was created by a leading FinTech group called Credissimo, a well-known presence in the market for a decade. It has successfully served millions of users from all over Europe. Credissimo has amassed $155 million in cash since its inception and given away loans worth $120 million. It is also regarded as a pioneer in the online consumer lending sector, in almost all European countries.

The co-founder of the Nexo running business, Credissimo is Kosta Kantchev, who is among the earliest users of Bitcoin and has been active in the European FinTech industry for over a decade now. The CTO Vasil Petrov has successfully accumulated more than 16 years of expertise in niche domains, such as system administration, architecture design of high-load and full-cycle projects and back-end development.

How Does Nexo Work?

Nexo attempts to bring together instant loans through blockchain technology. The whole Nexo process of obtaining loans against digital assets can be completed within minutes. The platform uses blockchain technology, algorithmic procedures, and smart contracts in its native Nexo Oracle module, offering a high level of transparency.

To acquire a loan in USD or EUR, users need to deposit supported cryptocurrency coins and tokens, including Bitcoin, Ethereum, XRP, Cardano, Monero, Binance Coin, and more into a Nexo wallet. You can also acquire a loan in another crypto asset such as Tether (USDT).

What are Current and Future Applications of Nexo?

Nexo offers a high level of asset liquidity which is not common in the crypto sector. The company makes things easier by offering a free credit card to its retail clients, which can be used towards making daily transactions.

There are several use cases for Nexo which can be highlighted by the numerous user groups:

● Investors: Cryptocurrency investors don’t have to wait to receive immediate funding, based on their crypto asset’s market value, which includes Bitcoin, Ethereum, tokenized assets, and liquid cryptocurrencies.

● Miners: Mining rewards often require liquidation to keep up with power requirements, stay competitive and grow operations. Nexo can prevent this liquidation by offering instant crypto-backed loans.

● Hedge Funds: Portfolio comprising of investments made in ICO tokens, cryptocurrencies, and digital assets can be leveraged by obtaining instant crypto loans. This can also provide the advantage of new investment opportunities.

● Exchanges: Platforms and exchanges can make use of Nexo’s instant crypto-backed loans to raise necessary finances and funds, which help with their trading and margin lending services.

NEXO is expected to be the future of the lending industry. The team claims that loans repaid using NEXO accrue almost 50% lower interest rates and other discounts. Also, larger balances tend to unlock higher loan limits and more savings. This is a great way of putting unused crypto assets to use.

There is over $1.5 million worth of NEXO being traded daily on multiple crypto exchanges, such as HitBTC and Hotbit. Nexo has good things coming its way because the platform offers loans without requiring credit checks. It doesn’t even require users to pay capital gains taxes for loans taken using their crypto assets.

The platform has already built a profitable business model with these price benefits in place. However, short-term lending comes with its drawbacks making it a high-risk industry for everyone involved.

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