Nexo to Leave US, Cites “Inconsistent and Changing Positions” of Regulators
In a Monday blog post, the UK-based crypto lender Nexo announced it would withdraw from the United States. According to the company, the decision is a result of “a lack of regulatory clarity.”
Nexo to Leave the United States
According to the announcement, the primary reason for Nexo’s decision to leave the US is its many issues with regulators. The company claims that cooperation with regulators has recently become nearly impossible as they “are unwilling to coordinate with one another, and are insistent on taking positions that are inconsistent with one another.”
The withdrawal from the United States is expected to be a gradual process. Nexo also announced that its Earn Interest Product will stop being available to customers in 8 states from December 6th—Indiana, Kentucky, Maryland, Oklahoma, South Carolina, Wisconsin, California, and Washington. The company added that their customers will “have uninterrupted access to their assets” throughout Nexo’s exit from the market.
The crypto lender also expressed its regret over the decision. However, it also stated that it is unable to continue its operations despite “more than 18 months of good-faith dialogue with U.S. state and federal regulators” and efforts to proactively address any issue that might arise.
Join our Telegram group and never miss a breaking digital asset story.
Nexo’s Fight With Regulators
In a Twitter thread released along with the blog post, Nexo states that it had “expended significant efforts to do things the right way.” The crypto lender provides its 2018 registration with the SEC, the quick delisting of the XRP due to the Ripple lawsuit, and the 2021 expulsion from New York and Vermont as examples of it complying with regulatory demands even to its own detriment.
Nexo found itself under pressure in 8 states this September when it was accused of offering unregistered securities. However, the company singled out the Consumer Financial Protection Bureau’s (CFPB) recent investigation of the company’s Earn Interest Product as the straw that broke the camel’s back.
Nexo’s announcement, and the explanation it provided for the decision, is echoing the concerns expressed both by industry insiders, and lawmakers with regard to the state of cryptocurrency regulation. For example, Senator Pat Toomey accused the SEC of failing to “provide the framework it is using when assessing digital assets” in a September interview, while Congressman Tom Emmer went so far as to call the regulator a “shakedown authority” in August
Do you think more crypto companies will start leaving the US due to regulatory pressure and confusion? Let us know in the comments below.