Nexo reaches landmark resolution with U.S. Regulators

Nexo, the world's leading institution for digital assets, has reached a final landmark resolution with the U.S. Securities and Exchange Commission (SEC), the North American Securities Administrators Association (NASAA), consisting of all 50 U.S. States and three territories, the Attorney General of New York, the Texas Department of Banking, the Alaska Division of Banking and Securities and the Washington Consumers Services Division.

Important characteristics of the settlement with U.S. Federal regulators include:

· There have been no allegations or charges by U.S. federal regulators that Nexo engaged in any fraud, or misleading business practices, or that any Nexo customers have been harmed or misled about Nexo’s financial health. It also brings to an end all proceedings against the company in eight US states, which were entirely administrative in nature.

· The only finding by state regulators regarding non-compliance with legal requirements by the company was with respect to the lack of the required registration to offer in the United States Nexo's interest-bearing product accepted as securities.

· With this, U.S. regulators close all inquiries into Nexo, looking at various aspects of the business

The full text of the company's announcement:

January 19, 2023 - Nexo, the world's leading institution for digital assets, has reached a final landmark resolution with the U.S. Securities and Exchange Commission (SEC), the North American Securities Administrators Association (NASAA), consisting of all 50 U.S. States and three territories, the Attorney General of New York, the Texas Department of Banking, the Alaska Division of Banking and Securities and the Washington Consumers Services Division.

Important characteristics of the settlement with U.S. Federal regulators include:

· There have been no allegations or charges by U.S. federal regulators that Nexo engaged in any fraud, or misleading business practices, or that any Nexo customers have been harmed or misled about Nexo’s financial health. It also brings to an end all proceedings against the company in eight US states, which were entirely administrative in nature.

· The only finding by state regulators regarding non-compliance with legal requirements by the company was with respect to the lack of the required registration to offer in the United States Nexo's interest-bearing product accepted as securities.

· With this, U.S. regulators close all inquiries into Nexo, looking at various aspects of the business.

“We are content with this unified resolution which unequivocally puts an end to all speculations around Nexo’s relations to the United States.

Unfortunately, even Bulgarian state authorities and institutions were not ashamed to and continue to abuse the U.S. name and the reactions in connection with their outrageous actions in creating an alibi are yet to come.

The botched suggestions of an 'international' element in the actions against Nexo to justify brazen arbitrariness against our company NDS EOOD and our over 600 employees in Bulgaria, as if almost at the request of the "Euro-Atlantic partners", are exposed by irrefutable facts. In addition, the attempt to attach the raid against Nexo, by scheduling it on a day that would coincide with another Europol raid against call centres in Bulgaria, Serbia and Cyprus, using cryptocurrencies, was thwarted by EUROJUST's official confirmation (EU Agency for Criminal Justice Cooperation) that the two events are not related.

However, the organisers achieved quite a few of their political objectives. To all participants and those chiming in during the unsuccessful attempts to kill a successful and growing business will be held accountable for any damage done," said Antoni Trenchev, co-founder of Nexo.

"Regardless and despite what has happened, the Nexo team continues to be fully focused on what we do best – building innovative and secure financial services for our millions of customers around the world.

As a reminder, Nexo is one of the very few companies unaffected by the wave of bankruptcies in the crypto industry over the past 12 months and this is the clearest attestation for the resilience of our business and model.”

"We thank the state regulators involved in the process for their objectivity and professionalism, and for their effort and dedication to do what they believe, that best protects the interest of the American people. Values such as transparency, entrepreneurial freedom, and adherence to the highest professional, ethical and legal standards are fundamental to this nation and which Nexo fully recognizes and deeply relates to.

We are grateful to our legal advisors at Schulte Roth and Zabel LLP for facilitating a most constructive dialog with the U.S. federal and state regulators, as well as the New York Attorney General’s Office, which helped us secure this most favorable of outcomes,” said Trenchev

It is Nexo’s belief that the company has been recognized for what it truly is - a pioneer, like Uber and Airbnb, providing disruptive solutions in a fast-paced environment. As innovators do not quite fit into existing provisions, constructive dialogue for the enhancement of the prevailing regulatory frameworks is of paramount importance.

Kosta Kantchev, Co-founder of Nexo, added: “We are confident that a clearer regulatory landscape will emerge soon, and companies like Nexo will be able to increasingly offer value-creating products in the United States in a compliant manner, and the U.S. will further solidify its position as the world’s engine of innovation.”

These resolutions are the pinnacle of almost two years of work and are a clear example of Nexo's principles on which we are building a transparent, predictable and sustainable business model that has stood the test of time in the marketplace. The full cooperation provided to US regulators is greatly appreciated by them. The Nexo team has been committed and unwavering in its commitment to uphold the highest standards in terms of complying with its regulatory and KYC/AML/CTF obligations, protecting clients and investors, and ensuring financial stability and growth of its operations and the industry as a whole.

About Nexo

Nexo is the world’s leading digital assets institution. The company’s mission is to maximize the value and utility of digital assets by offering a comprehensive suite of products that include advanced trading solutions for retail and institutional clients, aggregation of liquidity from leading venues, and tax-efficient asset-backed credit lines. In early 2022, the enterprise launched its investment arm Nexo Ventures, which now boasts over 60 portfolio companies. Nexo has processed $130+ billion for 5,000,000+ satisfied users across more than 200 jurisdictions.

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