Nexo will phase out its products and services in the United States over the coming months.
The cryptocurrency managing and lending platform said in a Monday (Dec. 5) blog post that the decision follows 18 months of dialogue with state and federal regulators that has come to a “dead end,” despite the firm providing information that was requested and modifying its business practices to address their concerns.
“It is now unfortunately clear to us that despite rhetoric to the contrary, the U.S. refuses to provide a path forward for enabling blockchain businesses and we cannot give our customers confidence that regulators are focused on their best interests,” Nexo said in the post.
The company said it will phase out its offerings in the U.S. in a “gradual and orderly fashion.” It said that as it ends the availability of certain products, it will continue to allow access to other products until further notice and will continue processing withdrawals in real time so that customers continue to have uninterrupted access to their assets, according to the post.
“We firmly believe that the blockchain is a transformative technology and recognizing its importance is akin to recognizing the value of the Internet in the early 2000s — it has immense economic and geopolitical importance,” Nexo said in the post. “For our part, we will dedicate our time and effort to developing products and services for jurisdictions that understand the importance of blockchain technology in a rapidly digitizing world.”
The announcement comes about two months after Reuters reported that eight U.S. state regulators charged Nexo, saying it had failed to register its Earn Interest Product.
The regulators from New York, California, Kentucky, Maryland, Oklahoma, South Carolina, Washington and Vermont all filed administrative actions against the company on the grounds that its accounts should be qualified as securities and registered that way, according to the report.