Loan Platform Nexo Requests US$3 Billion in Compensation from the Bulgarian Government

Source : X

Nexo, a Swiss-based lending platform, is seeking a $3 billion compensation from the Bulgarian government, claiming damage to its reputation and significant shareholder losses due to a terminated criminal investigation.

Initially, prosecutors accused Nexo executives of participating in an organized criminal group from 2018 to 2023 aimed at profiting from crypto asset lending. Bulgarian citizens and Nexo founders—Kosta Kanchev, Antoni Trenchev, Trayan Nikolov, and Kalin Metodiev—were initially charged following a raid in January 2023.

In December 2023, Bulgarian prosecutors dropped the case against Nexo, stating that there was no evidence of wrongdoing by the four Bulgarian citizens accused after the raid on Nexo's offices earlier that year. Prosecutors cited Bulgaria's legal regime lacking coverage for crypto assets as one reason for dropping the charges.

Nexo has detailed its $3 billion claim against the Republic of Bulgaria and has filed the claim through the International Centre for Settlement of Investment Disputes (ICSID) based in Washington, D.C., USA. Nexo submitted legal documents through its subsidiary in Switzerland, Nexo AG, to ICSID on January 18, 2024. The institution handles legal disputes between international investors and countries.

Nexo claims to have been working with three U.S. banks for an initial public offering on the main stock exchange, with an initial valuation between $8 billion and $12 billion. The company also alleges that it was on the verge of signing a multi-year deal with a major European football club, undisclosed, exposing Nexo to over 330 million people.

A statement from Trenchev mentioned, "Despite the business being able to continue its operations, Nexo has suffered due to the termination of the investigation. Our growth trajectory has slowed, and opportunities have been lost or significantly delayed. I personally pledged 10 months ago that we would explore all available legal means to obtain financial compensation for Nexo."

A separate report noted that the Bulgarian Ministry of Finance acknowledged receiving an arbitration request from ICSID, which will be reviewed soon.

NEXO Token Price Impacted

Image : NEXO token price chart

The price of NEXO utility tokens, the platform's native token, appears to be impacted by the company's 2023 case. The token price briefly dropped to a low of $0.5143, with a 2023 price performance increase of only +30%.

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