Nexo Under Investigation: Crypto Lender Records Outflows Amid FUD

• On-chain data shows that addresses related to crypto lender Nexo are recording outflows following news of financial crimes investigations by the Bulgarian government.
• Nexo’s real-time attestation by Armanino showed that its customer’s liabilities were $2.42 billion (133,263 Bitcoin) as of Jan. 12.
• Several crypto community members believe that Nexo could be the next victim of a crypto contagion that has taken several other companies by storm.

The crypto market has been rocked by news of financial crimes investigations by the Bulgarian government against crypto lender Nexo. On-chain data shows that addresses related to Nexo have been recording outflows since the news broke, with roughly $9 million leaving the platform in the wake of the news.

Crypto intelligence platform Arkham Intelligence dashboard revealed that the majority of the withdrawals were from retail investors who had deposited to centralized exchanges like Binance, Kraken, and others. Meanwhile, Nexo’s real-time attestation by Armanino showed that its customer’s liabilities were $2.42 billion (133,263 Bitcoin) as of Jan. 12.

This news has created a wave of fear, uncertainty, and doubt (FUD) in the crypto market, with some community members believing that Nexo could be the next victim of a crypto contagion that has already taken down several other companies. A partner at MetaCartel Ventures DAO, Adam Cochran, said Nexo would be „the last of the shady centralized stakers (to) fall,“ while Ram Ahluwalia, the CEO of Lumida Wealth, added that he had called out „Nexo’s nonsense back in June and on Laura Shin’s podcast.“

The news of the investigation has caused investors to be wary of Nexo, with many questioning the security of the platform and its ability to protect customers‘ funds. The Bulgarian government has yet to comment on the case, and it is unclear how the investigations will unfold.

Nexo has released a statement expressing their commitment to their customers and their continued efforts to ensure the safety and security of their funds. They have stated that they are working closely with the relevant authorities to ensure that their customers are not affected by the investigation and that the platform remains secure.

The crypto community is now waiting to see how the investigation plays out and if Nexo is able to weather the storm. It remains to be seen if the platform will be able to rebuild the trust of its investors and come out unscathed or if the investigation will have lasting implications.