Nexo price is hovering near its all-time low as investors react to the decision by Celsius to file for bankruptcy. The token’s price is trading at $0.5896, which is slightly above the all-time low of $0.5500. It has a market cap of $329 million.
Celsius files for bankruptcy
Nexo is a leading fintech company in the blockchain industry that provides numerous services for both individuals and businesses. Its primary product is one that lets people deposit their cryptocurrencies and then borrow cash.
Nexo has also introduced additional services in its ecosystem. It has a buy feature that lets people buy cryptocurrencies like BTC and ETH. Further, it has an earn feature that lets people deposit funds and earn significant returns. Finally, Nexo has a card, which enables people to buy products online and in stores.
According to its website, Nexo has processed over $80 billion in the past four years and has more than 4 million customers. As such, the company has a very similar business strategy to Celsius.
The Nexo price is falling as investors worry about the company’s future after Celsius filed for bankruptcy protection. In a statement, the firm said that going bankrupt will help it reorganize its finances and come back to business.
Therefore, analysts worry about contagion risks such as what happened when Lehman Brothers collapsed. At the time, governments had to bail out banks like Royal Bank of Scotland (RBS) and UBS. As such, there are concerns that Nexo could be next.
Nexo has denied that its business is at risk. The management has gone an extra mile to explain that its business has substantial differences with Celsius. The firm has also acquired Vauld, a company that also went bankrupt recently.
Still, it is relatively risky for traders and investors now that Nexo has been accused of embezzling funds in the past few weeks.
Nexo price prediction
The daily chart shows that the Nexo token price has been in a strong bearish trend in the past few months. This decline is in line with the overall performance of cryptocurrencies like ether and bitcoin. It is also in line with the rising fears about Nexo and its business.
The coin has moved below the 25-day and 50-day moving averages. It has also formed a small descending triangle pattern that is shown in red. Therefore, there is a likelihood that the token will have a bearish breakout as sellers target the support at $0.50.
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