Nexo dodges $219M bullet just days before FTXs solvency crisis

According to Nov. 8 Tweet, crypto lender Nexo has now net-zero exposure to the ongoing crisis involving crypto exchange FTX and crypto trading firm Alameda Research. Nexo also explained that he withdrew his entire balance from FTX within the “last few days.”

Alex Svanevik, CEO of blockchain analytics platform Nansen, said: Confirmed This story provides data showing that Nexo withdrew over $219 million from FTX between November 1st and November 8th. It also ranks Nexo as the top company for outflows over the past week.

The company seems to have dodged a major bullet when on November 8th, FTX announced it would stop all non-fiat consumer withdrawals. Continuing its assessment of the situation, Nexo said it was making a small loan to Alameda Research, representing less than 0.5% of his assets. The loan is fully collateralized by digital assets, which Nexo said he sold on Nov. 6. According to the company, the transaction resulted in a “100% recovery of principal and $0 loss for the company.”

.@nexo Net exposure to FTX/Alameda is $0.
As a conservative institution with strict risk management @nexo We have secured *all* our funds by withdrawing our full balance from the exchange in the past few days, as evidenced by our on-chain data.https://t.co/py8fzBDKbP
1/

Nexo (@Nexo) November 8, 2022

Nexo has so far dodged major industry-wide risk events this year, including the collapse of Terra, hedge fund Three Arrows Capital and cryptocurrency lender Celsius. A real-time audit of the company’s assets under custody shows that Nexo currently has over $3.4 billion in consumer debt, with collateral coverage exceeding his 100% and fully backed by Nexo’s assets. This figure is attested by US accounting firm Armanino LLP, an auditor certified by the Public Company Accounting Oversight Board.