Nexo Resumes New Client Registrations In The UK After FCA Compliance Update

Nexo, known for its crypto lending products, has announced its restarting new client registrations in the UK today. The platform updated its system to comply with all FCA guidelines before reopening.

Additionally, Nexo has teamed up with Gateway 21 to ensure it follows all financial promotion rules set by the UK’s Financial Conduct Authority (FCA).

Nexo Seeks To Ensure Continued Operation In The UK And Broader European Markets

Elitsa Taskova, Nexo’s Chief Product Officer, stated that when faced with strict but necessary regulations, the company chose to stay committed. The firm carefully adjusted its platform to meet these tough standards.

Nexo halted new client registrations in the UK last October, just days before the local regulator enforced new rules on financial promotions on October 8, 2023. The guidelines required crypto companies to register for self-approval of ads and update their systems to give first-time buyers at least 24 hours to reconsider their investment choices.

Nexo, along with other companies like Luno, Bybit, and PayPal paused either accepting new clients or offering certain services in the UK due to FCA regulations.

Interestingly, Nexo also shut down two of its UK subsidiaries, Nexo Clearing and Nexo Financial Services Limited, last year as part of its restructuring. Despite these changes, co-founder Antoni Trenchev confirmed that Nexo had no plans to exit the European markets.

Nexo Wants To Maintain Uninterrupted Access To Its Services For Users

Nexo has required its UK users to go through assessments for categorization in line with FCA rules, which were finished on July 16. All current Nexo users must finish an “Investor Categorisation and Appropriateness Assessment” to keep uninterrupted access to Nexo’s services and products.

The initial set of questionnaires was designed to categorize investors into three groups, including certified sophisticated investors, high-net-worth investors, and restricted investors. The second set of questionnaires aimed to assess users’ understanding of the risks associated with crypto investments, including products like crypto-backed loans.

While users can take the Investor Categorisation test as many times as needed, the Appropriateness Assessment has a cool-off period. If a user fails the Appropriateness Assessment twice in a row, a 24-hour cool-off period begins. After six failed attempts, the cool-off period extends to seven days.

Nexo explained that the cool-off period is intended to give users time to reconsider whether investing in crypto assets is truly suitable for them. The company also stated that these assessments are designed to make sure users’ investment knowledge aligns with the guidelines set by the Financial Conduct Authority (FCA).