“Given the challenges of the confusing and contradictory US regulatory regime, it is with a heavy heart that we begin the gradual and orderly departure from the US.”
Nexo announced its plans to gradually exit the US market after hitting a “dead end” in its discussions with the US regulators.
In its blog post, Nexo claimed that it is suspending its “Earn Interest Product” in eight US states starting December 6. The lending firm also plans to gradually halt all services for its US user base.
Nexo stated that the decision was influenced by a lack of regulatory clarity from the authorities, adding,
“We have reached a point where regulators are unwilling to coordinate with one another, and are insistent on taking positions that are inconsistent with one another.”
Earlier this year, Nexo began halting interest-bearing services for new US clients. It also paused new deposits from its existing users residing in the US. Despite these measures, the platform was sued by eight state regulators over its high-yield accounts in September.
"In addition, a number of the very state securities regulators we had been cooperating with for several months blindsided us by filing actions against us without advance notice."
Recently, Nexo requested the Consumer Financial Protection Bureau (CFPB) to halt ongoing investigations into its Earn product. According to the court filing, the lender cited that the regulators “[lacked authority] over the product.” However, this request was denied by the CFPB on Thursday, with Nexo noting that the authorities' recent stance on crypto regulation has created an "impossible environment [for Nexo] to operate efficiently."
Nexo added that it will unlock active Fixed Interest without penalty for select US clients starting December 6. It will also credit the accrued interest to their savings wallet.
The price of Nexo's utility token, NEXO, also dropped following the announcement. NEXO is currently priced at $0.6535, down by 5.18% in the last 24 hours.
