Nexo said in December that it will discontinue offering its goods and services in the US.
According to reports on Thursday, Bulgarian authorities have begun an inquiry into potential unlawful acts carried out by bitcoin lender Nexo. They conducted raids at more than 15 locations in Sofia, the country’s capital. The declaration follows Nexo’s declaration in December that it will gradually stop offering its goods and services in the United States over the ensuing months owing to disputes with authorities.
According to Siyka Mileva, a spokesperson for the prosecutor’s office, “active efforts are being taken in Sofia as part of a pre-trial investigation intended to neutralize an illegal criminal activity of crypto lender Nexo.” It has been proven that the majority of the worldwide platform’s organizers are Bulgarian nationals, and the majority of its operations are conducted there, she added.
Mileva said that the operation encompassed approximately 300 detectives, police officers, and security personnel. They are looking into the formation of organized criminal groups, tax offenses, money laundering, unauthorized banking activity, and computer fraud. According to the prosecution, Nexo operated via several businesses, many of which were only “post boxes.”
Although Bulgarian officials were visiting one of Nexo’s locations, a public relations representative for the company informed Reuters via email that the company “only has operational expense-related tasks” such as payroll, customer support, and back office. When it comes to the cryptocurrency realm, crypto lenders operate like banks, giving their clients interest on the coins they deposit on their platform.
The Nexo platform reportedly processed $94 billion during the course of the previous five years, according to Bulgarian authorities. Without going into further detail, they claimed to have proof that someone who was formally proven to have funded terrorist activity had sent cryptocurrency through the site. Following the collapse of the important exchange FTX last year, legislators from around the world have intensified calls for the regulation of cryptocurrency companies.
During the COVID-19 epidemic, businesses expanded quickly, but when the cryptocurrency market crashed last year, a number of lenders froze withdrawals, leaving consumers with significant losses. Celsius, Voyager Digital Ltd., and BlockFi are all significant U.S. lenders that declared bankruptcy last year.
