APR18.9%(Variable)
Risk score72High
Founded in 2018 and registered in the Cayman Islands, Nexo offers crypto trading, interest accounts, and collateral-backed loans. In January 2023 it paid a $45 million settlement to US federal and state regulators after its Earn Interest Product was judged an unregistered security. The firm has also faced UK Financial Conduct Authority scrutiny, pausing new registrations until compliance updates, and a Bulgarian money-laundering probe that was closed for lack of evidence.
Interest rate
Variable (e.g. 18.9%)
Currency support
USD, EUR, GBP, USDC, USDT
Fees
0%
Collateral
BTC, ETH, +100 other assets
LTV
Up to 50%
Loan type
Consumer
Liquidation LTV
83%
Margin call
70%
KYC
Yes
Total loan issued
N/A
Launch year
2018
Loan duration
12m
Support
Email, Chat
Loan value
$50 - $2,000,000
Total risk score72High
Collateral
0/10
What are you pledging? Native BTC is safest; wrappers, bridges, or paper IOUs add redemption risk.
Native BTC (on-chain UTXO).
Rehypothecation
7/10
Will your BTC be re-used? More hidden leverage → bigger blow-up chance.
Terms grant Nexo the right to rehypothecate customer assets; extent and counterparties undisclosed.
Custody
7/10
Who can move the coins? Scores quorum design, recovery paths, and (for CeFi) bankruptcy-remote segregation.
Coins are pooled across third-party custodians (Ledger Vault, Fireblocks, BitGo, Bakkt, etc.) in a mix of hot + cold storage.
Nexo claims those partners "maintain segregated wallets for each of their clients," but there is no independent, wallet-level attestation and no statement that assets are bankruptcy-remote; in fact, the loan T&Cs say Nexo "acquires the ownership of the Collateral" while a credit line is open.
Security & Governance
4/10
How battle-tested are code and ops? Counts audits, bug-bounty, certs, and hardware key isolation.
Nexo itself holds SOC 2 Type 2 and ISO 27001/27017/27018 certifications, and stores client assets with custodians who also carry independent SOC 2 Type 2 attestations. These audits cover the custody tech, yet Nexo never discloses an externally-verified cold-vs-hot split or publishes controls over its cold-to-hot workflow; those aspects remain self-declared.
Platform
0/10
Is the chain or bridge robust? Rates consensus security and smart-contract attack surface.
Native Bitcoin script.
Oracle
10/10
How is price fetched and signed? Independence, on-chain proofs, refresh speed, circuit breakers.
All collateral pricing, LTV changes, margin-calls and liquidations are controlled by the in-house “Nexo Oracle,” a proprietary algorithm whose code, data feeds and governance are completely opaque. Clients receive warnings or forced repayments triggered by this closed system, but they cannot audit its logic or price sources.
Liquidation Buffer
4/10
How much room and time before liquidation? Combines LTV gap, grace window, and flash-crash guards.
Nexo provides a 33% liquidation buffer (50% → 83%), warns at 70%, and liquidates instantly above 83% with no stated grace window.
Rate & Term
4/10
Can interest spike mid-loan? Looks at fixed vs variable APR and funding duration match.
Variable APR, presently 18.9 %. A BTC borrower who holds zero NEXO tokens pays the base 18.9 % rate. Nexo reviews and may revise borrowing rates each year or during "extreme market conditions," so the 18.9 % figure is not contractually capped.
Transparency
7/10
Can outsiders verify code & solvency? Rewards open-source + live PoR; punishes black boxes.
Nexo previously provided real-time on-chain attestations through Armanino (via TrustExplorer) and later through Moore (via TrustReserve); however, both services have since been discontinued.
As of July 2023, Nexo no longer offers active real-time proof of reserves, does not disclose on-chain wallet addresses, and uses a closed-source attestation mechanism.
Loan Currency
4/10
What asset do you borrow? Native-BTC best; fiat stables graded on reserves, audits, censorship risk.
USDC, USDT, USD, EUR, GBP.
Privacy
7/10
How exposed is your identity? Scores KYC depth, data storage, and breach history.
Full KYC/AML mandatory; large trove of personal data held with third-party vendors.
History
7/10
Have they proven themselves? Measures years live, audit/OSS footprint, and incident track record.
Paid $45 M SEC settlement (Jan 2023) for unregistered securities offering; no insolvencies, but regulatory breach recorded.
Jurisdiction
2/10
Which legal system backs you? Rates clarity of licensing, creditor rights, and enforcement.
The lending entity is Nexo AG, incorporated in Zug, Switzerland (Commercial-Register No. CH-170.3.042.338-1)