Money Laundering Charges against Nexo in Bulgaria Dropped

The authorities in Bulgaria have closed the investigation against crypto lending platform Nexo, citing a lack of evidence to support the allegations. As confirmed yesterday (Friday) by the Bulgarian News Agency, the Prosecutor's Office highlighted that cryptocurrencies are not regulated, and products offered by Nexo do not constitute financial instruments.

Prosecutors Could Not Establish Serious Charges

The investigation against Nexo in Bulgaria surfaced earlier this year with raids at the company’s Bulgarian offices. The probe alleged various charges, including tax offenses, banking without a license, money laundering, and computer fraud. The investigation was focused on four Nexo executives – Kosta Kanchev, Antoni Trenchev, Kalin Metodiev, and Trayan Nikolov.

However, the prosecutor found no evidence of money laundering, tax, or computer fraud. Further, they could not establish that the platform carried out banking activities without a license.

“The dropping of all charges made against Nexo and its executives by the Bulgarian Prosecutor's Office, with their confirmation that there were no crimes, unequivocally shows that the whole attack on Nexo was political and should not have happened in the first place. It also goes a long way in clearing our names and is a vindication for all good actors in crypto – we are very content with this result,” said Antoni Trenchev, the Co-Founder and Managing Partner of Nexo.

The Questionable Model of Cry

Nexo primarily provides crypto lending services, offering interest rates as high as 16 percent yearly on crypto deposits. According to its website, it has already paid out more than $200 million in interest to over $6 million users. It additionally offers services like purchasing and the exchange of cryptocurrencies, borrowing against crypto deposits, and a payment card.

The platform has already settled with the federal and state regulators in the United States, paying a total sum of $46.5 million. According to the US authorities, Nexo’s ‘Earn Interest Product’ could be classified as securities, and the company has agreed to cease offering the questioned products as a part of the settlement.

Meanwhile, the Bulgarian authorities pointed out that Nexo ran online in the country and “probably” operated from outside the country.