Crypto lending platform Nexo says its strong balance sheet means it can ride to the rescue by securing assets of struggling crypto firms during current market turmoil to provide liquidity.
In a blog post, Nexo announced that it is currently receiving advice from banking giant Citigroup on how to acquire the assets of bankrupt crypto firms so that investors can gain access to blocked funds.
Last week Antoine Trenchev, co-founder and managing partner of Nexo, told Bloomberg that the current crypto crash reminds him of the horror of 1907 – where major Wall St. institutions were forced to bail out other struggling firms.
“It reminds me very clearly, of the 1907 bank panic, where JPMorgan was forced to step in with its own money and then rally all those who were solvent to correct the situation.”
In the blog post, Nexo claimed that it had always run a sustainable business model that did not engage in risky lending practices, as a result it is now in a state of “unmatched stability”, meaning it is uniquely suited to step into breaches. has been put in place to help shore up struggling firms.
“The crypto space is about to enter a phase of massive consolidation, which has already begun with the remaining solvent players, such as Nexo, seeking to provide immediate liquidity to their clients and provide relief to companies with solvency issues. Expresses its readiness to acquire assets across the industry.”
The post revealed that Nexo has already interacted privately with several struggling crypto firms, offering a variety of ways to provide liquidity support.
On June 13, Nexo publicly announced that it was ready to acquire some of Celsius’ outstanding loans, following revelations that the fellow lending platform was suffering from a major liquidity crisis.
Nexo’s native token, NEXO, fell nearly 25% on the same day to a new yearly low of $0.61 per coin, as fears of a major DeFi transition echoed in the market.
Three days later, infection fears resurfaced as investment firm 3 Arrow Capital (3AC) failed to meet margin calls – losing $400M in liquidation across multiple positions. Nexo says it has no exposure to 3AC.
Unlike many other embattled firms, Nexo has 100% liquidity to meet its $4.96 billion worth of debt obligations, according to US-based audit firm Armanino.
related: Celsius crisis highlights the problems of low liquidity in bear markets
According to TradingView data, NEXO price has stabilized since the major drop on June 13 and is currently trading at $0.65.