In the Crypto industry, you will see different firms being set up with every passing day. But, most of the firms fail to make it to the last due to different reasons. Also, the advent of regulatory guidelines for this market in the nations is occurring. The firms may find it hard to adjust to the new rules and guidelines.
Nexo is facing a similar issue in the U.S. The firm is stopping all its operations in the nation. It is stating that the firm is finding it hard to adjust to the altering situations. The regulators are changing and restructuring their positions way too often. As they are unable to cope with this inconsistency, Nexo will leave the U.S. market. Read this blog to find out more. https://bitcoin-buyer.io is the best trading bot used by millions of investors, you can invest in cryptos on this platform.
Regulatory Guidelines Are Causing Hindrance
For around 18 months, Nexo was operating in the U.S. on a basis of integrity with the federal regulators of the nation. Despite this functioning, the firm is now finding it unable to operate further in this country.
Nexo shares that these regulatory bodies cannot be dealt with. These bodies are way too inconsistent and keep changing their positions when it comes to legal aspects.
The firm also shares that the nation is against Blockchain technology and is not offering opportunities for its development. In this situation, the firm is unable to assure its customers that the regulators will provide them with the best chances.
Pressure From The Regulators
This firm is even facing a huge amount of pressure from federal and state regulators to stop its services. The major pressure is for the “earn” product of Nexo. With this product, you can earn a decent and consistent return on your Cryptocurrency deposits.
The regulators of California have issued an order for this firm to stop lending this product. As per the regulatory body, this product falls under unregistered securities. Nexo is also experiencing the same amount of pressure from Vermont and New York. Due to this, the firm withdrew its operation from those two regions as well!
Besides this, Nexo’s special “earn” product had been stopped in eight other states. These are Kentucky, Maryland, South Carolina, Washington, and others. All other existing products can be availed on a short-term basis. Also, the firm will resume its client withdrawals.
Nexo also highlighted different actions it took to act following the regulators. It registered the Nexo token with the SEC and delisted XRP. The firm did this under the SEC’s instruction that most of these digital currencies which are not BTC are assets too.
The firm announced that in the initial days the regulators were quite supportive. But, later they changed their status and position on this matter.
Nexo And The Other Firms
The SEC was sharing a positive response towards the Cryptocurrency firms. But, after a certain period, the firm shared that they are suspicious of all the Cryptocurrency firms. This is because these firms offer much higher and better returns than conventional ways.
This agency also stopped Coinbase from offering its services. And, for this act, they even faced severe criticism from the CEO of Coinbase. The CEO says that the standards of the SEC which they term as security, are unclear and void.
Also, BlockFi had to pay a fine of around 100 million USD against its yield products in February this year. After this, Nexo decided to stop accepting any deposits against its “earn” product.
Nexo is among the last Cryptocurrency firms that are standing amidst the bearish phase. Most of the other firms like FTX, BlockFi, Celsius, and others have filed for Bankruptcy. Genesis is on its way to experience one soon!
The inconsistency in the stand on the part of regulatory bodies is making it tough for Crypto firms to survive. In the first place, these agencies seem to support Crypto trading and the firms. But, over time, they turn their back and show negative responses towards these firms.
Nexo is finding it difficult to survive in the market of U.S. and will exit it soon.