Nexo has announced that it will soon be accepting Binance Coin as collateral for loans on its platform. The company also said it has received applications from 26 other companies looking to have their tokens added to the platform. Currently, Nexo’s clients can use Bitcoin, Ethereum and Nexo’s own token as collateral.
Instant Crypto-backed Cash Loans
Nexo, which is based in Switzerland, is backed by Credissimo, a Fintech company with 10 million clients across Europe. Credissimo was founded in 2007 and operates several businesses providing instant loans and bill payment services.
Nexo’s business model is simple. It provides instant crypto-backed cash loans, with borrowers pledging selected cryptocurrencies as collateral. Platforms like this provide a vital link between the crypto and fiat economies by allowing investors to keep their exposure to crypto assets while also having access to cash. Nexo completed an ICO on 1 April, raising $52.5 million.
Nexo’s token is also one of the first dividend tokens – holders receive 30 percent of the profits earned by the platform. The company hopes this will incentivise investors to hold rather than trade the token. The fact that token holders can also borrow fiat using the Nexo token as collateral provides a further incentive to invest for the long term.
It may be that the Nexo team are hoping that, by integrating Binance into its own ecosystem, Binance will follow up with a reciprocal gesture to increase Nexo’s own visibility within the crypto markets. Time will tell.