Nexo Review: Pros, Cons and Comparison for 2021

Before you invest your cryptocurrency, you should always do research on the company you plan to invest with. You should not have to search high and low to find a Nexo review, so we have gathered the most important information about the platform in one place. This way, you can make an educated decision before making an investment.

Basics of Crypto Lending

Crypto lending allows you to make a profit from your cryptocurrency by letting someone else borrow it. In return for lending the cryptocurrency, you earn interest. You can find a borrower yourself or use a peer-to-peer lending platform. There are also managed crypto lending accounts that help you earn interest via professionally managed lending and other strategies. Review

The platform offers you the ability to exchange, earn, or borrow cryptocurrency. If you are interested in lending, the earning options are likely the most appealing to you. The exchange controls your cryptocurrency and lends fiat to make a profit.

It has been around since 2018. While this is a fair amount of time, it is still new. Some relevant figures to give you more peace of mind about Nexo include support in more than 200 jurisdictions, support for more than 45 fiat currencies, and a loan volume of $1.5 billion.

If you are wondering is Nexo legit, the answer is yes. The company has a satisfied customer base and offers various features. Our research for this Nexo review focused on cryptocurrency earnings. The company lets you earn up to 8% interest with most cryptocurrencies or up to 12% with stablecoins. That interest is paid daily and compounds.

If you review the Nexo lending website, you will notice that they say you can withdraw or add funds whenever you want, and there is a “unique” daily payout model. However, these two features are not as unique as the platform wants you to think. You can take advantage of both with Haru, as well.

Custodial Crypto Lending

Nexo offers custodial crypto lending, meaning that it controls your assets. It actively manages your crypto, lending it out to gain that interest. Essentially, Nexo pools its client assets (both crypto and fiat) and then actively manages them.

As mentioned, Nexo offers fiat loans with crypto collateral. The platform also offers crypto loans with crypto collateral. The platform uses a low collateral ratio, which makes the loans more appealing to borrowers.

Risks Associated With Nexo

There a few important risks to keep in mind if you choose to invest with Nexo. The first relates to crypto custody. It uses BitGo multi-sig wallets with a total insurance of $100 million. This cap is the maximum coverage for all clients, not per client. Additionally, the insurance only applies to crypto in the cold wallet, but Nexo needs to keep some crypto in hot wallets, so it can lend it.

Another risk is the lack of legal entity information regarding Nexo. There is no mention anywhere on the website or privacy policy of a legal entity that controls Nexo. This minimizes confidence in the brand.

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How Nexo Works

With Nexo, you deposit your cryptocurrency and do not have to do anything else. The team manages the crypto for you, using their skills to earn interest. You can earn interest in a range of cryptocurrencies and stablecoins. You can withdraw your crypto at any time you want.

How Managed Crypto Lending Accounts Work

Our Nexo review shows you an example of a managed crypto lending account. These managed accounts work by putting your cryptocurrency in the hands of experts. They find opportunities to earn profits on your cryptocurrency and then pass on those profits to you via interest.

Managed crypto lending accounts typically use more strategies than just lending cryptocurrency to others. They may do this to some extent, but they will also use crypto trading strategies and other investment strategies to produce gains.

The idea behind these managed accounts is that you can earn a profit without having to put in the effort to learn crypto trading strategies yourself or having to find borrowers you can trust. Instead of worrying about your beginner-level knowledge and whether it is enough, you get to put your crypto in the hands of experts. This should increase the rewards and reduce the risk while also letting you put in minimal (or no) effort.

The Expertise and Experience of the Account Manager Matters

The most important part about how managed crypto accounts work is that you are trusting the team managing your crypto with the funds. You need to have faith in their ability to manage your crypto properly. After all, you don’t want to pay someone to manage your funds only for them to lose some of your crypto.

That is one area in which our Nexo review found room for improvement.

Latest Performance Numbers of Haru Invest

To give you an idea of what is possible if you opt for a well-managed crypto account, consider the latest performance figures from Haru Invest (March 1-15, 2021).

The Earn Like the Best account, which lets you invest your BTC, had a biweekly return of 0.6261%. This becomes an annualized return of 15.23%. The Surf with the Volatility account, which invests USDT, had a biweekly return of 0.6089% or an annualized return of 14.82%.

We’re continuously sharing the latest performance numbers on our medium blog, have a look at that.

Why Haru Is a Better Option for Crypto Lending

After looking at all the information in our Nexo review, it becomes clear that Haru is a better option. While Nexo is legit, Haru has several very important advantages over it.

Common Benefits

To start, Haru and Nexo offer nearly identical convenience features. Both have a daily-compounding interest. Both let you withdraw or deposit whenever you want. Both let you create an account and start earning quickly.

  • Both have 24/7 support, but Haru has a more customer-centric reputation.
  • Both offer simple signup, but Haru’s is a bit quicker and easier to complete.

Haru is More Profitable

Nexo appeals to potential customers with its advertised interest rates of up to 8% for crypto or up to 12% for stablecoins. However, there are caveats to earn those rates, specifically the need to hold the NEXO token.

Even with those figures, you can earn better interest rates by using the Haru Invest accounts.

Crypto In, More Crypto Out. It's that simple.

The best way to grow your crypto asset is here.
Effortless yet stable. That’s how your earnings should be.

No Need to Own Proprietary Coins to Boost Interest Rate

Keep in mind that the best interest rate on Nexo requires holding NEXO tokens. The advertised interest rate includes a bonus interest of 3% or 4%, which only applies if you own or use NEXO.

This comes with a very high risk as the NEXO token has less usability than the other cryptos you would likely invest in. It limits your investments in other cryptos and means it may have a higher risk of dropping.

Expertise in Fiat and Crypto

Haru also stands out with its long history of experience in both crypto and fiat. This is enhanced by its partnerships with the best digital asset management firms in the world.

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