There has been panic in the digital space amidst rumors of Nexo being insolvent due to the abrupt withdrawal of Wrapped Bitcoin (WBTC) from MakerDAO with an address labeled as Nexo Ox8fd.
This comes just a few days after market analysts predicted a 50% drop in the price of Nexo.
According to reports gotten from sources, approximately $151 million worth of WBTC was withdrawn on Friday from MakerDAO from the Nexo wallet.
While many users believe the sudden withdrawal is a fraudulent move by the company, a Nexo spokesperson has highlighted that the withdrawn funds are still in the public space (Nexo wallet) adding that;
“the withdrawal was a routine transaction and represents a loan repayment according to the latest market dynamics and the company’s normal asset management.”
Nexo has continued to provide professional financial services to the digital economy since 2018. Nexo is among the world’s most trusted financial institutions that provides lending services in the digital finance industry. According to the firm, it has more than 5 million users around the world transacting with about 40 fiat currencies across more than 200 jurisdictions.
Crisis in the Digital Assets Economy
The recent uproar comes after a number of recent crypto bankruptcies have left investors without access to their funds this year. Nexo customers are seriously in dismay considering that Celsius Network which offers a similar offering to Nexo filed for bankruptcy after freezing customers’ accounts in June.
About eight states in the United States had earlier in September filed proceedings against Nexo as regards registration and cryptocurrency products yielding interests.
According to state regulators in New York, Kentucky, California, Maryland, Oklahoma, South Carolina, Washington, and Vermont, Nexo offered users accounts earning interests without registering them as securities and without providing required information.
Investors, according to state regulators, cannot make informed investment decisions without access to these financial statements.
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