Nexo, A Cryptocurrency Lender, Has Announced That It Would No Longer Pay Interest On New Deposits From US Consumers.

Nexo has announced a set of policy adjustments for US consumers, as the Securities and Exchange Commission investigates crypto lending goods and services.

The policy changes apply both current and new accounts, according to an email issued to users and a message on Nexo’s official subreddit, with the company claiming it “voluntarily implemented changes to its Earn Interest Product in the U.S. to comply with newly-announced guidance.”

“Nexo’s registered clients who are currently earning interest on the platform will continue to do so on their existing digital asset balances only,” the company said, adding:

“Top-ups to your Nexo Wallets made after today will not earn interest until the restructuring of the Earn Interest Product and the registration process with the relevant regulatory bodies are complete, as per the recently received guidance. Once complete, all new accounts will be transferred to the Earn Interest Product 2.0 and the new top-ups will earn interest. Please note that if you withdraw any of the assets in your current balance, you won’t be able to earn interest on them even upon their subsequent return.”

Nexo’s Earn Interest Product will not be offered for new customers in its current form until the restructure of the Earn Interest Product and the registration process with the appropriate regulatory agencies is completed, as per the recently received guidelines.

“The current changes only affect Nexo’s Earn Interest Product in the U.S. and have no impact on any other Nexo products,” the statement stated. “Non-U.S. clients are are not subject to the SEC’s guidance and remain unaffected by any of these changes.”

Given the SEC’s expanding control of the crypto lending market, the timing is significant. BlockFi, a crypto lender, reached a $100 million settlement with the SEC and state securities authorities earlier this week. In addition, the company intends to register its BlockFi Yield product as a security.

The SEC’s chief, Gary Gensler, has mentioned the crypto lending industry as one area that federal regulators are looking into.

According to unredacted documents made public at the time, Nexo and cryptocurrency loan service Celsius were investigated in the US state of New York in October.

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