Crypto investors generally do two things, i.e., Buy & Sell.
They sell when the price is high and buy when the price is low. However, many investors miss-time their buy and sell due to FOMO.
But don’t you think there should be more to your crypto assets. I mean avenues to do more with your digital currencies like Bitcoin, Ethereum, etc.
For example, lending and borrowing cryptocurrencies!!
And the good news is, it is no longer a hypothetical example. Apart from buying/selling your cryptocurrencies, now you can lend and borrow them too. Borrowing and lending crypto have several benefits, which we have discussed in our previous article on crypto loans.
Moreover, some don’t want to sell their assets in real life but are forced to do so because of a lack of options. For such individuals, crypto loans are perfect.
And one such company that excels in providing this service is Nexo, and that’s why we are going to talk about Nexo loans today. So let’s get the ball rolling:
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Nexo Review & Nexo Lending Review
Nexo Lending platform is a blockchain-based platform that provides crypto-backed loans to its customers. These Nexo loans can be availed by keeping your cryptocurrencies as collateral with the Nexo platform.
That’s why Nexo lending is also known as the instant crypto line of credit, where one can get extra cash in USD or EUR without having to relinquish their ownership of cryptocurrencies at the same time.
This way, the crypto loan borrower gets the much-needed liquidity for the crypto assets that he/she doesn’t want to sell simultaneously, keeping the right to claim back his crypto collateral as it might be worth even more in the future.
Nexo Lending & Interest Account
Nexo is a unique platform because it allows you to earn attractive returns without taking any risk. The majority of people entering the crypto space believe the only way to earn money is by buying and selling it in the open market.
While buying and selling cryptocurrencies in the short term, also known as crypto trading, can help you make big profits, the risk is also significant. If the price goes against your trade, you can incur substantial losses and end up blowing your account.
For instance, Bitcoin’s price has skyrocketed from $5,000 in March 2020 to $65,000 in April 2021, a jump of a whopping 1083%. Then, it lost 56% of its value and plunged to $28,650 in the next month. And then, it again rose by 43% to $50,000 in August.
This volatility is like a double-edged sword. If you trade in the right direction, you can become an overnight millionaire, and if you’re wrong, you can go bankrupt.
That’s why many financial experts associate crypto trading with sophisticated gambling. Though it’s not gambling, and you can make money, it requires a thorough understanding of chart patterns and price movements’ technical and fundamental aspects.
What if there was a safer way to earn money from crypto? Here’s where Nexo’s lending platform comes into the picture. Nexo allows you to deposit your crypto assets in an interest savings account and earn up to 6-12% annual percentage yield (APY).
Crypto-Backed Loans by Nexo
Here’s another exciting application of cryptocurrencies. You can use your crypto assets as collateral to take a loan. You don’t need to go to any bank or ensure a healthy credit score. You need to enter the desired loan amount and get the loan on the same business day.
Nexo offers credit lines from $50 to $2 million. So, whether you need funds to go on vacation or buy a car, Nexo lets you do that effortlessly.
Now, how are Nexo’s crypto-backed loans different? Unlike other platforms that accept only Bitcoin or stable coins as collateral, Nexo accepts 21 assets, ranging from BTC, ETH to stablecoins like USDT and USDC to emerging cryptos like Cardano and Polkadot.
How Does Nexo Loan Work?
The way Nexo loans work is pretty straightforward and easier to understand than the traditional lending cycles. Moreover, almost all critical platform parts are automated through blockchain-based smart contracts, so you need not worry about human errors.
Most importantly, the entire process is effortless. Even if you have never applied for a loan with your bank, you can easily use the “borrow feature” on Nexo.
As soon as you top up your account, a credit line becomes available, and you can withdraw funds instantly based on your collateral.
Let’s delve deeper into the steps for taking a loan through Nexo.
#1. Transfer Crypto Assets to Nexo wallet
The first step is to add crypto assets to your Nexo wallet. If you haven’t registered with Nexo already, sign up and complete the KYC first. Once that is done, transfer your crypto collateral to the Nexo wallet and wait until the funds show up in your account.
Next, click on the “top-up” button to transfer your crypto assets to top-up. Please note that Nexo will consider your funds as collateral only after you add them to the top-up.
#2. Receive Instant Loan
Once the collateral is confirmed on the blockchain, Nexo oracle evaluates your collateral quality, and its value determines the appropriate LTV for you. Nexo offers 15-90% LTV depending on the underlying asset. Let’s look at the LTV available for each crypto asset.
- 15% – NEXO
- 30% – XRP, BCH, LTC, EOS, EOS, BNB, XLM, LINK, TRX, DOT, ADA, DOGE
- 50% – BTC, ETH
- 70% – PAXG
- 90% – USDT, USDC, PAX, TUSD, DAI, HUSD
After you top-up your assets, Nexo will shop the credit line available for each of your crypto assets. This way, you’ll know how much loan amount you can get and the interest rate you’ll need to pay.
Nexo enables instant fund transfer so that you can receive your funds directly in fiat to your bank account or in a stable coin. Then, you can choose the funds you want to withdraw. For example, your LTV, as suggested by Nexo, is 50%, and the total worth of your collateral is $10,000, then you can receive a loan of up to $5000.
#3. Repay Loan
Repayment of the loan is quite flexible in Nexo as you are not required to make monthly repayment until your outstanding balance is less than the loan limit. Also, you can avail of a 50% discount on the interest rate if your collateral or repayment is in Nexo tokens.
You can repay all or part of your loan at any time by bank transfer or using crypto, including the assets deposited in your Nexo Wallet.
Again, Nexo offers a lot of flexibility when it comes to loan repayment. You can repay your loan at any time using any amount in fiat. You can make loan repayments using cryptocurrencies and stablecoins as well.
You can even repay your loan partially through fiat and partially through crypto. Nexo doesn’t impose any loan repayment fee, and you can make loan repayment within 12 months.
However, if you repay your loan within 30 days, the standard interest rate of 13.9% will apply regardless of your loyalty tier.
#4. Withdraw Your Collateral
Once you have repaid your full loan amount along with interest, you can easily withdraw your crypto collaterals from the top-up wallet to your savings wallet. The withdrawal process is also seamless. When you repay the loan amount, the collateral shows up in your top-up account.
How to Get an Instant Crypto Loan from Nexo?
Now that you know everything about Nexo loans and the company, it’s time that we briefly discuss how to get instant crypto-backed loans from Nexo?
As discussed in the previous section, getting a crypto-backed loan from Nexo is easy. All you need to do is add crypto assets to your top-up account and withdraw the funds you need to borrow. Let’s quickly summarize the loan application process in Nexo.
- Firstly, register and login to Nexo.
- Complete your basic KYC to get loans up to $10,000 — complete detailed KYC by submitting relevant photo ID proofs to get loans up to $2 million.
- Once KYC completes, deposit your crypto assets to the Nexo wallet against which you want to take the loan. For example, deposit BTC, ETH, XRP, etc.
- Now once these deposits are confirmed on the blockchain, go to the ‘withdraw loan’ section, and you will see the loan limit available to you as per your deposited collateral.
- Choose the preferred loan withdrawal method and accordingly add your bank details or stablecoin’s address to receive your Nexo loan.
Features Of Nexo Loans
- Low-Interest Rates
Nexo offers crypto loans starting from a competitive interest rate of 6.9% only. Not only is this lower than many other crypto borrowing platforms, but it is also significantly lower than the standard bank loan rate of 10-24%.
- Automatic Approval
You don’t need to undergo the complex and time-consuming procedure of a credit check. Nexo supports automatic approvals without credit checks. As a result, loan applications get approved on the same business day.
- Insurance on Custodial Assets
Nexo offers insurance up to $375 million on custodial assets, and it’s one of the few crypto platforms to do so. This provides an additional layer of security to the users.
- Flexible Credit Lines
Nexo has flexible credit lines ranging from $50 to $2 million. Moreover, the credit lines are backed by over 21 assets, ensuring a hassle-free borrowing process for everyone.
Flexible Collateral Management
Nexo supports multiple cryptocurrencies and offers varying LTV and interest rates for each. After approving the loan, the company manages your collateral and ensures complete security and storage.
Which Collateral Coins Nexo Accepts?
As of now, the Nexo platform accepts 21 cryptocurrencies and stablecoins as collateral. These include:
Crypto: NEXO Token, Bitcoin, Ethereum, Ripple, Bitcoin Cash, Litecoin, BNB, EOS, Chainlink, Stellar, Tron, PAXG, Cardano, Polkadot, and Dogecoin
Stablecoins: Tether, USD Coin, PAX, TrueUSD, DAI, HUSD
Of course, there are plans to add new coins and tokens that can act as collateral. Currently, the voting for new coins to be added is going on here, and only NEXO token holders can vote for it.
Some more exclusive features of Nexo loans make it an ideal choice for taking crypto-backed loans. We are going to discuss that in our next section on why to choose Nexo for crypto loans?
Why Choose Nexo for Crypto-Backed Loans?
Nexo is a subsidiary of Credissimo, a leading fintech group serving millions of people across Europe for over ten years. This is the main reason to trust Nexo as it is backed by an experienced company that has been in the lending business for over ten years.
Moreover, in just seven months of its launch, Nexo has established itself as the world’s leading crypto lending service and has processed more than $300 million to a growing user base that at present exceeds 170,000.
And so far, there has been no breach or significant defaults on the crypto loans through the Nexo lending platform because the loans are generally overcollateralized, which automatically factors in the wild volatility of crypto markets.
Nexo Loans & Interest Accounts Fees
Nexo clearly states on its website that it doesn’t charge any fees from its users. There are no loan origination fees or prepayment charges. When you take a loan, you only need to pay the interest rate.
However, a withdrawal fee may apply when you withdraw funds from your Nexo wallet. These fees aren’t essentially imposed by Nexo but third-party payment gateways. For instance, your bank or digital wallet provider may charge a small transaction fee.
How Does Nexo’s Lending Platform Work?
Nexo also has the largest network. It is the most advanced and trusted instant crypto lending provider globally, supporting 24 cryptocurrencies. You can deposit crypto in your interest savings account and earn up to 12% on your assets.
Unique daily payouts, no hidden fees, military-grade security, and full control over your funds are some reasons to use Nexo’s lending platform.
Nexo’s lending platform is also easy to use, and it works similarly to crypto-backed loans. You need to top up supported assets in your Nexo account. And that’s it; you don’t need to do anything else. You can start earning interest on your deposits instantly.
Features of Nexo Lending
Nexo allows you to grow your crypto portfolio exponentially and without any risks. Let’s look at the key features of Nexo’s lending platform.
- Daily Compounding Payouts
Nexo offers unique daily payouts, providing you with instant access to the interest you have accrued. The earned APY is automatically transferred into your savings account so that you can earn interest on top of it from the next day. This way, the interest compounds over time.
- Flexible Earnings
Though Nexo has no lock-up periods, you can earn bonus yield by depositing your assets for fixed terms. Nexo offers 15-day and 30-day lock-up periods.
- Zero Fees
Nexo charges no hidden fees or commission on holding or withdrawing funds. You can withdraw anytime using any withdrawal methods without worrying about losing your accrued interest.
- Top-Tier Insurance
Nexo works with BitGo and Ledger as its custodians to offer $375 million insurance on crypto deposits. Hence, you can stay assured that your funds are insured and secured.
- Seamless Automation
The process is fully automated and is available for all Nexo Wallets with no minimum amounts & no fee restrictions. These deposits are insured up to $100M, and even more, assets are coming soon to help you earn interest on your crypto assets.
Additionally, Nexo claims to have paid out over $50 million in interest to 2 million+ users worldwide.
Which Coins Does Nexo Accept?
Nexo allows you to diversify your portfolio by earning interest on 24 digital assets. The APY depends on the underlying asset. Let’s look at the support assets and their corresponding APYs.
- 12%: NEXO
- 10%: USDT, USDC, PAX, TUSD, DAI, HUSD, EURX, GBPX, USDX
- 6%: BTC, ETH, XRP, BCH, LTC, BNB, EOS, LINK, XLM, TRX, PAXG, ADA, DOT
- 1%: DOGE
You can earn an extra 2% interest rate on all assets (except NEXO) by choosing to earn interest in NEXO. Hence, 10% APY on stablecoins becomes 12%, and 6% and 1% APY on cryptocurrencies becomes 8% and 3%, respectively.
Nexo is one of those few crypto lending and borrowing platforms that offers dividends to eligible token holders. To date, Nexo has distributed over $20 million in dividends and shared over $30 million in dividends to company investors.
Nexo paid the last dividend in June 2021. The payout comprised 30% of the company’s net profit for the financial term 2020-2021. The company exhibited a 233% growth compared to the previous dividend payout of $6.12 million.
- How do Nexo Dividends Work?
Nexo token holders are paid 30% dividends on their holdings. This 30% is paid from the company’s profit, and it is only paid to eligible Nexo holders. See here who is an eligible Nexo holder to receive dividends.
Nexo dividends work similarly to stock dividends. The company rewards its stakeholders, i.e., NEXO token holders, from the excess profits the company generates.
What Other Products Does Nexo Offer?
While crypto loans and lending are the key offerings by Nexo, the company offers other products and services as well. If you want to do more with your crypto other than borrowing and lending, here’s a quick dive into the product offerings of Nexo.
- Buy Crypto
Nexo allows you to buy crypto on your own terms. If you want to enjoy the borrowing and lending services on Nexo but don’t have any crypto assets to get started, Nexo solves that issue for you.
Nexo lets you instantly buy over 100 cryptocurrencies and stablecoins using fiat currency. You can buy crypto using three currencies: USDx, EURx, and GBPx. At Nexo, you can buy cryptos at the best market prices and that too without paying any fees.
- Crypto Exchange
Not only buying, but Nexo also allows you to seamlessly sell cryptos or exchange them for other tokens and fiat currency. The platform guaranteed a fixed price and immediate execution. Furthermore, it offers unlimited swaps, allowing you to make up to $100,000 per single transaction.
- Nexo Card
The Nexo card allows you to use your crypto assets on the go. You can use it like any other debit card to make payments. Besides, it allows you to make payments in local currencies. Over 40 million merchants across hundreds of countries accept the Nexo card.
Other benefits of the Nexo card are:
- Instant cashback on all purchases
- Free additional virtual cards
- No monthly, annual, or FX fees.
Nexo offers an institutional lending desk, allowing institutional investors to borrow, lend, and swap digital and fiat assets. If you’re an institution, you can generate yield on your protected idle assets. The industry-leading custody and tailor-made terms and durations make borrowing and lending on Nexo seamless for institutions.
There are many reasons to use Nexo for borrowing and lending crypto. If you are a new crypto investor who wants to explore how crypto works, Nexo is a perfect platform for you. It’s easy to use and allows you to do more with your crypto.
Another major advantage of Nexo is that it doesn’t charge any fees. There are no charges for loan origination, prepayment, or even trading cryptos.
In addition, the platform offers low-interest rates on loans, high APR on deposits, and various other products as services, such as card, exchange, and institutional lending desks.
So, because of all these reasons, Nexo is an excellent platform to avail of your crypto loans, and that’s all from our side in today’s review of the Nexo.io platform.
If you are someone who has used this platform already? Then do share your experience with us and if you haven’t checked Nexo out, then do so as the registrations might close due increase in the popularity of crypto-backed loans!!
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