Nexo Mulls Suing Bulgaria for $1 Billion, Says Co-Founder Antoni Trenchev

Antoni Trenchev – Co-Founder of the cryptocurrency lending platform Nexo – said the company could sue the Bulgarian government for more than $1 billion for raiding its offices and undermining its reputation.

He also refuted the rumors that members of the entity run an organized criminal group, and commit money laundering and terrorist financing operations.

‘We Will Defend our Interests’

The clash between Nexo and the Bulgarian authorities escalated after Trenchev vowed to take the dispute to court:

“Our consultants estimate the damages at over $1 billion. We were in the process of listing on the American stock exchange, and now it has to be postponed because of the reputational damage that was done to us.”

The executive claimed the actions of the Bulgarian prosecutors to raid the offices in the capital Sofia were “absurd, unnecessary, and a large part of them – illegal.”

The Nexo scandal happened just a day before President Rumen Radev was about to give the third and final mandate to form an acting government. Some assumed Democratic Bulgaria (a center-right political party that pledged to cope with corruption and enforce several judiciary reforms) had the best chance of receiving the mandate.

However, it was revealed that more than a dozen Nexo employees had previously made significant donations to the aforementioned party, which might have affected the President’s decision. He eventually gave the mandate to the Bulgarian Socialist Party (BSP).

Trenchev agreed with the assumption that raiding Nexo’s offices precisely that day was an orchestrated PR move from the prosecution. He also admitted knowing the leader of Democratic Bulgaria – Hristo Ivanov:

“I know Hristo Ivanov. I was part of public life in Bulgaria years ago. But I don’t see how that’s relevant. We are a handful of people in Bulgaria.”

Nexo’s boss said people are free to make donations and sees nothing wrong with those that gave away funds to Democratic Bulgaria since they have publicly registered and reported everything to the Audit Office.

Despite the confrontation, Trenchev assured that the crypto lender still has a solid base of five million customers and processes millions of transactions every day.

Paying $45 Million to the US

Apart from its issues in Bulgaria, Nexo recently agreed to pay $45 million in penalties to the US SEC and the NASAA over allegations that it offered crypto lending products without complying with the necessary regulations. Commenting was Gary Gensler – Chairman of the SEC:

“We charged Nexo with failing to register its retail crypto lending product before offering it to the public, bypassing essential disclosure requirements designed to protect investors. Compliance with our time-tested public policies isn’t a choice.

Where crypto companies do not comply, we will continue to follow the facts and the law to hold them accountable. In this case, among other actions, Nexo is ceasing its unregistered lending product as to all U.S. investors.”

Nexo confirmed the fines, stating they are pleased to have engaged in a “constructive dialogue” with the watchdog and settled all the issues.