Nexo.io @ 6.5% - is it safe?

saverT86

Nexo.io recently announced that they are launching a EUR savings product with a 6.5% interest compound rate, paid daily. It's easy access, but requires a minimum of 5000 EUR to deposit.

They claim to be risk free, with the following explanation:

"By successfully topping up your EUR balance, you agree with the General Terms and Conditions of Earn Interest Product and you automatically exchange the top up amount's EUR equivalence to EURx with a guaranteed 1-to-1 conversion rate to EUR at all times. You earn risk-free compounding interest of 6.5% per year, paid out daily, on your EURx which is secured at all times by asset-backed portfolios of overcollateralized loans. The collateral of each loan is subject to custodial insurance of $100 million provided by the world’s leading audited custodian BitGo and the insurance leader Lloyd’s of London. Upon receipt of a EUR withdrawal request, the EUR equivalent of EURx is automatically exchanged to EUR at the guaranteed 1-to-1 conversion rate and the EUR is sent to the bank account designated in the withdrawal request."

From their IBAN, they seem to be based in Lithuania.

With the ability to transfer money into Euros easily via Revolut, this could be a very good savings product. But is your money actually safe?

ColdIron

6.5% easy access from an apparent Lithuanian crypto vendor with no FSCS protection. What could possibly go wrong?

MaxiRobriguez

It says you earn risk free compounding interest.

It doesn't say the underlying asset is risk free. You'll earn 6.5% compound as long as the loans don't go bang/disappear basically.

Clive_Woody

ColdIron wrote: »

6.5% easy access from an apparent Lithuanian crypto vendor with no FSCS protection. What could possibly go wrong?

I think your career in marketing could be short lived.....

msallen

You'd be better off investing in a barge pole.

[Deleted User]

As soon as they mentioned Deloitte had audited them

dunstonh

Nexo.io recently announced that they are launching a EUR savings product with a 6.5% interest compound rate, paid daily. It's easy access, but requires a minimum of 5000 EUR to deposit.

1 - it is not a savings "product"
2 - its not even a retail financial services product
3 - its not risk free (despite it saying it is)

FCA permissions are passported in and only cover:
(1) Transferable securities
C(2) Money-market instruments
C(3) Units in collective investment undertakings
C(4) Derivatives in Securities, etc

this could be a very good savings product

No it can't. It is not possible as it isnt a savings product.

But is your money actually safe?

There is no FSCS protection and its not risk free.

MaxiRobriguez

So are we all saying that 6.5% is worth the risk?

Malthusian

MaxiRobriguez wrote: »

It says you earn risk free compounding interest.

It doesn't say the underlying asset is risk free.

On the top of nexo.io it says "Earn 6.5% Interest on EUR and Stablecoins. Risk-Free." Which is a lie. Or to use the legal terminology, misleading.

"Credissimo adheres to the highest regulatory requirements and has been strictly supervised by multiple European Banking and Financial Services Regulators since 2007"... in Bulgaria. The maf1a state that brought you OneCoin. Bulgaria + crypto + supposedly secured loans + "risk-free" returns of 6.5% per year + Bulgaria = what could possibly go wrong.

AnotherJoe

Whatever happened to risk free returns of 7.9% available everywhere from scammers until recently?

How far have things deteriorated if 6.5% is the new high for a scam product?
It wasn't like that in my day when you could invest in South Sea shares and get 100% interest without even trying.

Malthusian

MaxiRobriguez wrote: »

So are we all saying that 6.5% is worth the risk?

Ohhh, you're trolling. Never mind.