According to state regulators, the crypto lending firm is insolvent without their $NEXO token holdings. The same situation that led to Celsius Network's collapse...
man like nexo token is basically an exchange token. of course everyone's gonna hold it on nexo cause its the only place it has utilities -- what use you have of it holding it on a ledger?! so naturally everuyone holds nexo on... nexo.. shocker. look at all the other exchange tokens, same shit with FTX etc.
lots of words in this article instead of a simple explanation.
The problem here is that if there is a bank run on Nexo (like there have been on a dozen other yield platforms already), Nexo will almost certainly not be able to convert the assets they hold (NEXO tokens) into the assets they would owe their depositors (bitcoin, tethers, USD, and the like).
So, yes, everything is fine unless any significant number of people want to cash out… which, again, has already happened with a dozen or so of Nexo’s competitors in the past six months.
If Nexo is unable to pay people in bitcoin, tethers, or USD, they may try to get people to take NEXO tokens instead… but the reason they would have NEXO and not bitcoin, tethers, or USD is that they would not have been able to recoup the current nominal value of NEXO on the open market themselves, and it’s unlikely their individual creditors would do any better.
Exactly, after the bank run or stress test of the last few weeks, it seems that Nexo is still holding up. This seems to have only increased confidence in Nexo, like you said, I also think that any traditional bank wouldn't endure a bank run like Binance or Nexo have endured in the last few weeks, they are required to have +100% collateralization, which they probably have, cause they probably are looking more in the long term than FTX
Assuming Nexo uses the same style of Terms of Service that Celcius etc did, can we confirm if they're counting their customer deposits in the asset column rather than as liabilities? That could explain the discrepancy between the tokens they claim to have and the tokens actually under their control.
man like nexo token is basically an exchange token. of course everyone's gonna hold it on nexo cause its the only place it has utilities -- what use you have of it holding it on a ledger?! so naturally everuyone holds nexo on... nexo.. shocker. look at all the other exchange tokens, same shit with FTX etc.
lots of words in this article instead of a simple explanation.
The problem here is that if there is a bank run on Nexo (like there have been on a dozen other yield platforms already), Nexo will almost certainly not be able to convert the assets they hold (NEXO tokens) into the assets they would owe their depositors (bitcoin, tethers, USD, and the like).
So, yes, everything is fine unless any significant number of people want to cash out… which, again, has already happened with a dozen or so of Nexo’s competitors in the past six months.
If Nexo is unable to pay people in bitcoin, tethers, or USD, they may try to get people to take NEXO tokens instead… but the reason they would have NEXO and not bitcoin, tethers, or USD is that they would not have been able to recoup the current nominal value of NEXO on the open market themselves, and it’s unlikely their individual creditors would do any better.
The bank run will produce the same effects for whole banks in the world when you look at its assets (global bubble)
Exactly, after the bank run or stress test of the last few weeks, it seems that Nexo is still holding up. This seems to have only increased confidence in Nexo, like you said, I also think that any traditional bank wouldn't endure a bank run like Binance or Nexo have endured in the last few weeks, they are required to have +100% collateralization, which they probably have, cause they probably are looking more in the long term than FTX
Nice work. We will study it and inform our Spanish speaking community, integrating back links to the article and your site. Kind regards.
Assuming Nexo uses the same style of Terms of Service that Celcius etc did, can we confirm if they're counting their customer deposits in the asset column rather than as liabilities? That could explain the discrepancy between the tokens they claim to have and the tokens actually under their control.
Over the past few months, what has struck me the most is that they "offered" to aquire ailing competitors, but never did, have they?