Nexo Returns to the United States: A New Compliance‑Centred Model After the 2023 Crypto‑Lending Fallout
By [Reporter Name] – Cointelegraph
Date: April 2026
TL;DR – Key Takeaways
- Settlement and exit: In early 2023 Nexo paid a $45 million penalty to the SEC and several state regulators and withdrew its “Earn” product from U.S. customers.
- Regulatory focus: The SEC’s action was based on the view that Nexo’s interest‑bearing service functioned as an unregistered security, raising issues around retail marketing, transparency, custody and counter‑party risk.
- Re‑entry framework: The 2026 rollout no longer relies on Nexo directly offering yield products. Instead, the company works through U.S.‑licensed partners and, where required, SEC‑registered investment advisers.
- Bakkt partnership: By routing operations through Bakkt—a publicly listed crypto firm with a suite of U.S. licences—Nexo embeds its services in a regulated infrastructure, shifting from a issuer model to a partner‑delivered approach.
- User vigilance: Customers should verify the legal counter‑party, custodial arrangements, how returns are generated, loan‑to‑value limits and the completeness of risk disclosures, even when the product is offered via licensed intermediaries.
Background: The 2023 Enforcement Action
Nexo, founded by former Bulgarian legislator Antoni Trenchev, built its early U.S. presence around the “Earn Interest Product” (EIP), which let retail users deposit cryptocurrencies and receive a quoted yield. In January 2023 the U.S. Securities and Exchange Commission (SEC) announced that the EIP met the legal definition of a security and therefore required registration. The agency’s complaint centered on three main concerns:
- Promotion of yield products to non‑institutional investors – the service was marketed as a low‑risk, bank‑like return despite underlying crypto‑lending activities.
- Opacity about revenue sources – regulators argued that Nexo did not provide sufficient detail on how the advertised returns were derived.
- Custody and counter‑party risk – the SEC highlighted the lack of a clear, regulator‑approved custodial framework and the possibility that assets could be rehypothecated without investor knowledge.
Facing the allegations, Nexo entered into a settlement that included a $45 million payment to the SEC and various state securities regulators. The company did not admit or deny wrongdoing and immediately halted the EIP for U.S. clients, subsequently pulling back from the domestic retail market.
Why “Earn” Products Were in the Cross‑hairs
The crackdown on crypto‑lending products came after a wave of high‑profile failures in 2022 that exposed systemic weaknesses: liquidity shortfalls, mismatches between loan‑to‑value ratios and volatile collateral, and opaque risk‑transfer mechanisms. Regulators feared a repeat of those events could jeopardize retail investors and destabilise broader financial markets. Consequently, they began treating many “earn” platforms as securities issuers rather than simple custodial services.
The 2026 Relaunch: A Structural Overhaul
Three years after its exit, Nexo has announced a return to the United States. However, the comeback is not a simple reinstatement of its former product suite. The company’s new strategy hinges on three pillars:
1. Partner‑Led Distribution
Instead of acting as the direct provider of interest‑bearing accounts, Nexo now collaborates with entities that possess the necessary U.S. licences. These partners handle the regulatory front‑end, including client onboarding, compliance checks and, when required, investment advisory services registered with the SEC.
2. Segregated Service Layers
Cryptocurrency custody, trading execution and advisory functions are delegated to regulated intermediaries. By “wrapping” its core technology within a compliant infrastructure, Nexo distances itself from the legal classification of a securities issuer.
3. Bakkt as the Anchor
A cornerstone of the redesign is a partnership with Bakkt, a publicly traded crypto‑infrastructure provider holding a portfolio of U.S. licences (including a national securities exchange licence, a trust charter and a money‑transmitter licence in multiple states). Through Bakkt, Nexo can tap into an established compliance regime, ensuring that trading, custody and any advisory activities are performed under a regulated umbrella.
What This Means for U.S. Users
While the partnership model reduces the likelihood of another enforcement action, it does not eliminate risk. Potential customers should scrutinise the following aspects before engaging:
| Area | What to Verify |
|---|---|
| Legal Counter‑party | Identify whether the agreement is with Nexo, the licensed partner, or a combination of entities. |
| Custody | Confirm that assets are held by a qualified custodian subject to U.S. oversight. |
| Yield Generation | Understand whether returns stem from lending, staking, market‑making or other activities, and how those activities are disclosed. |
| Loan Terms | Review collateral thresholds, liquidation triggers, loan‑to‑value caps and any associated fees. |
| Disclosure Quality | Look for comprehensive risk warnings, rehypothecation clauses, conflict‑of‑interest statements and clear jurisdiction provisions. |
Even a “compliant” wrapper cannot guarantee a product is free from loss, especially given the inherent volatility of digital assets and the absence of federal deposit insurance for crypto‑based lending.
The Shifting Regulatory Landscape
Nexo’s timing coincides with a modest de‑escalation in the SEC’s crypto enforcement posture, partly attributable to the change in administration and a growing recognition that a blanket crackdown may stifle innovation. Recent examples—such as the SEC’s decision to withdraw a lawsuit against Gemini’s Earn offering after substantial investor recoveries—illustrate a more pragmatic, case‑by‑case approach.
Nevertheless, the U.S. regulatory environment remains fragmented. Federal securities law, state money‑transmitter statutes, and consumer lending regulations can all intersect depending on how a product is structured. Companies that adopt a partner‑led model benefit from the ability to align with the most relevant jurisdictional requirements, but they must still navigate a complex mosaic of rules.
Industry Implications
Nexo’s return could serve as a template for other foreign crypto firms seeking U.S. market access:
- Pre‑2023 – Direct‑to‑consumer yield products were offered with minimal registration.
- 2023‑2025 – Enforcement actions forced many platforms to suspend operations or restructure.
- Post‑2026 – A third phase emerges, characterized by collaboration with licensed U.S. entities and a clear separation of business functions.
If this model proves sustainable, it may accelerate a broader shift toward “infrastructure‑first” strategies, where the technology provider partners with regulated intermediaries rather than attempting to meet all compliance obligations internally.
Conclusion
Nexo’s re‑entry into the United States marks a significant evolution from a product‑centric approach to a compliance‑centric architecture. By leveraging licensed partners and the Bakkt platform, the company addresses the regulatory shortcomings that led to its 2023 settlement. While the new model mitigates many of the SEC’s earlier concerns, retail investors should continue to perform diligent due‑diligence, recognizing that regulatory compliance does not equate to risk elimination. The broader industry will be watching closely to see whether this partnership‑driven blueprint becomes the new norm for crypto‑lending services in the United States.
Source: https://cointelegraph.com/news/nexo-is-back-in-the-us-what-changed-after-the-2023-crypto-lending-crackdown?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
