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Nexo hires Citibank amid market crash for acquisitions advice

Nexo
TL;DR Breakdown
  • Citigroup is helping Nexo merge with other crypto lenders affected by the recent market collapse.
  • The announcement comes just a few weeks after Celsius Network, a competitor lending platform, temporarily froze customer withdrawals, raising fears of imminent bankruptcy.

Crypto financing platform Nexo has engaged Citibank to help it acquire struggling crypto companies during the present market volatility. The company has stated that its robust balance sheet will offer liquidity despite cryptocurrency prices falling. Furthermore, when crypto enterprises go bankrupt, Nexo intends to acquire their assets so that investors can reclaim the money they have invested in them.

In a statement, Antoni Trenchev, co-founder and managing partner of Nexo, likened the present crypto crisis to the 1907 panic. It’s a time when it compelled major Wall Street institutions to bail out other failing businesses.

Trenchev said it reminded him more of the 1907 bank crisis where JP Morgan had to step in with his capital and rally all those who were solvent to resolve the issue. According to Nexo, they poise the crypto business to enter a phase of mass consolidation. 

It’s a time when they think it has already begun with the remaining solvent firms. It shows Nexo’s readiness to buy the assets of companies with solvency issues to give quick cash to their clients and relief for the entire industry.

Nexo offering private liquidity support

Companies in financial difficulty are already receiving private liquidity support from Nexo. Following Celsius’s prolonged liquidity crisis, it recently showed that they are ready to acquire some of Celsius’ outstanding loans.

Armanino, an accounting firm, has declared that Nexo has all the liquidity it needs to pay its £4 billion in debt obligations, unlike many other organizations in the industry.

Problems with high-yield APY

Celsius was one of the fastest-growing companies in the crypto industry. Celsius had 800 employees at the time of the company’s demise, which had grown by over 200 percent in a year. 

The issue is that the crypto market is currently in a bear market, and for businesses to continue operating properly, they must maintain access to liquidity. Liquidity is a key problem for crypto investors now that most ordinary investors and institutions have sold their crypto holdings.

How Nexo has survived the current markets industry volatility and insolvency

Panic is possibly the worst form of guidance. However, if you have lately succumbed to this emotion, you have a pass. For some time now, red has been the dominant color on trading screens in both traditional and crypto markets, showing that both are in a bear market. The world’s central banks are reducing liquidity and raising interest rates, which the younger generation has maybe never believed conceivable. 

So, here are the key takeaways from Nexo’s efforts to educate its clients about what sets the company apart from most blockchain companies: Its capability to help others despite volatility and safeguards in place to secure their clients’ assets.

To ensure the safety of its clients’ funds, Nexo built its business model on the foundations of traditional finance and the blockchain. These principles include collateral lending and insurance, fully automated processes; global licensing; prudent risk management; and real-time reserve audits.

At a time when financial markets are in turmoil, Nexo says it will serve its customers with the most stable and dependable blockchain services possible. The reason is so that they can manage their money in any way they see fit.

In a press release, Nexo emphasized that no matter what happens in the future, they will continue to follow their roadmap steadfastly. In addition, they will continue to exceed expectations by delivering products that improve the financial independence of the community.  Nexo is a beacon of stability because of its careful risk management. It’s a sustainable and successful business strategy that operates in both up and down cycles and prefers platform excellence.

During these uncertain times, Nexo is looking to play an important part in consolidating the blockchain ecosystem. The potential of the crypto business is just beginning, and Nexo wants to ensure the safety of as many investors as possible while maintaining public confidence in it.

Nellius Irene

Nellius Irene

Nellius Irene is a cryptocurrency investor and journalist who has been in the nascent space since 2018. She has researched and written on several crypto-related topics including non-fungible tokens (NFTs), decentralized finance (DeFi), fundraising, mining, etc. Her major focus is covering regulatory events that are capable of shaping the entire crypto ecosystem.

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