Nexo hires Citi to advise on takeover amid market turmoil

Crypto lending platform Nexo said its strong balance sheet means it can provide liquidity during the current market turmoil by acquiring the assets of struggling cryptocurrency companies.

Nexo announced in a blog post that it is now being advised by banking giant Citigroup on how best to acquire the assets of crypto companies facing insolvency so investors can regain access to frozen funds. funds.

Last week, Nexo co-founder and managing partner Antoni Trenchev told Bloomberg that the current cryptocurrency crash reminded him of the panic of 1907, when major Wall Street institutions were forced to bail out other struggling firms.

"Frankly, it reminds me of the bank panic of 1907, when JPMorgan was forced to step in with its own money and then call everyone solvent to sort it out."

Nexo said in the blog post that it has been running a sustainable business model and does not engage in high-risk lending business, so it now occupies a position of "unrivaled stability", which means it is uniquely positioned to fill This loophole helps prop up struggling companies.

“The crypto space is about to enter a massive consolidation phase, with remaining solvent players such as Nexo signaling their readiness to acquire assets of companies with solvency problems in order to provide instant liquidity to their clients and ease the industry-wide pressure."

The post revealed that Nexo had privately approached a number of struggling crypto firms, proposing different ways to provide liquidity assistance.

On June 13, Nexo publicly announced that it was preparing to acquire some of Celsius’s outstanding loans, following news that the peer-to-peer lending platform was experiencing a severe liquidity crisis.

Due to market concerns about the spread of the DeFi crisis, on the same day, Nexo's native token NEXO plummeted by nearly 25%, falling to a new low of $0.61 for the year.

Contagion fears were reignited three days later as investment firm Three Arrows Capital (3AC) lost $400m in liquidations of multiple positions after it failed to meet margin calls. Nexo stated that they have no 3AC exposure.

Unlike many other troubled companies, Nexo has 100% liquidity to meet its $4.96 billion debt obligations, according to U.S. auditor Armanino.

According to TradingView, NEXO’s price has stabilized since its sharp drop on June 13.