Nexo is the latest DeFi platform to have fallen under the US Securities and Exchange Commission (SEC) scrutiny. This prompted the platform to make changes in an effort to comply with the “newly announced guidance”. It should be noted that as of late, the SEC has shifted its regulatory oversight to the DeFi lending sector.
Gary Gensler, the SEC chair, highlighted that the DeFi lending sector is highly unregulated. It poses risks such as market manipulation. As such, DeFi lending firms are being forced to restructure and be compliant.
Nexo is a regulated institution for digital assets. It offers customers to maximize the value and utility of cryptocurrencies. The platform fell under SEC’s watchful eye over it Earn Interest Product in the United States. But now the platform has made the necessary changes.
In an official announcement, Nexo said top-ups to the Nexo Wallets will not earn interest until the restructuring of the Earn Interest Product and the registration process with relevant regulatory bodies are complete. All new accounts will then be transferred to the Earn Interest Product 2.0. The new top-ups will earn interest.
The platform highlighted that the Earn Interest Product will not be available to new users until it has been restructured. The same will be registered with the respective regulatory bodies. It should be noted that the current changes will only affect Nexo’s Earn Interest Product in the United States. It does not have any impact on the platform’s other products and services.