Major lending platform Nexo has announced it is phasing out of the US market. The reason was the “dead end in conversations with regulators” and claims from the supervisory authorities of many states.
In their statement, Nexo representatives specifically noted the attention of regulators to the Earn product, which allows users to earn income on their deposits. On Dec. 1, the Consumer Financial Protection Bureau (CFPB) denied Nexo’s petition to drop its investigation into Earn’s product because it is subject to oversight by securities regulators.
“Regulatory pressure has become evident following the CFPB decision, which states the need to establish jurisdiction to investigate our interest-bearing product. At the same time, the US Securities and Exchange Commission (SEC) declares that the product is a security and falls under its jurisdiction. In addition, several state securities regulators with whom we have worked for several months have stymied us by suing without warning,” the company said in a statement.
At the beginning of the year, Nexo blocked interest payments for new US users. However, this did not help the company avoid persecution by US regulators.
Source: Bits
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