Crypto lending platform Nexo, says that its sturdy stability sheet means it could possibly experience to the rescue to offer liquidity in the course of the present market turmoil by buying the belongings of struggling crypto corporations.
In a weblog post, Nexo introduced that it’s at the moment receiving recommendation from banking big Citigroup on how finest to accumulate the belongings of bancrupt crypto corporations in order that buyers can regain entry to blocked funds.
Final week Antoni Trenchev, co-founder and managing associate at Nexo, informed Bloomberg that the present crypto crash reminds him of the Panic of 1907 — the place main Wall St establishments have been compelled to bail out different struggling corporations.
“This jogs my memory, fairly frankly, of the 1907 financial institution panic the place JP Morgan was compelled to step in along with his personal funds after which rally all these guys that have been solvent to repair the state of affairs.”
Within the weblog publish Nexo boasted that it had at all times run a sustainable enterprise mannequin that didn’t have interaction in dangerous lending practices, because of this it now occupies a place of “unmatched stability,” that means that it’s uniquely positioned to step into the breach to assist shore up struggling corporations.
“The crypto house is about to enter a part of mass consolidation which has already begun with the remaining solvent gamers, like Nexo, expressing their readiness to accumulate the belongings of corporations with solvency points with a view to provide speedy liquidity to their shoppers and reduction to the complete business.”
The publish revealed that Nexo has already made contact with numerous struggling crypto corporations in non-public, providing up other ways to offer liquidity help.
On June 13, Nexo publicly announced that it was prepared to accumulate a few of Celsius’ excellent loans, following revelations that the guy lending platform was suffering a major liquidity crisis.
On the identical day Nexo’s native token, NEXO plunged nearly 25%, falling to a brand new yearly low of $0.61 per token as fears of main DeFi contagion echoed by way of the market.
Three days later, contagion fears have been reignited as funding agency 3 Arrows Capital (3AC) failed to meet margin calls — struggling a lack of $400M in liquidations throughout a number of positions. Nexo says it does not have any publicity to 3AC.
In contrast to many different embattled corporations, Nexo has 100% liquidity to satisfy its $4.96 billion worth of debt obligations, in line with U.S.-based audit agency Armanino.
Associated: Celsius’ crisis exposes problems of low liquidity in bear markets
For the reason that main drawdown on June 13, NEXO’s worth has stabilised and is at the moment buying and selling for $0.65, in line with knowledge from TradingView.