Cryptocurrency

DeFi increase and Bitcoin rally place NEXO to shut 2020 with a plus of 480%

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In the past three months, the NEXO token, the native asset of Nexo's blockchain-based lending platform, has grown by more than 480%. Since Bitcoin (BTC) traded for $ 10,000, NEXO price has been keeping a close eye on BTC, but performance is a bit lacking when compared to the 1000% rallies seen by a handful of DeFi tokens.

NEXO / USDT daily chart. Source: TradingView

The project was originally unveiled by European FinTech group Credissimo in late 2017 and claimed it would offer "the world's first crypto-backed instant loans".

The platform was founded by Cresissimo employees Antoni Trenchev, Georgi Shulev, and Kosta Kantchev, and its original purpose was to enable crypto investors to borrow against the value of their crypto assets rather than selling their assets and attending a taxable event create.

Originally, Nexo planned to start a public presale and a main sale of tokens. However, these plans were canceled due to the extremely high demand from private sales to investors.

NEXO followed a course similar to most of the projects launched in late 2017 and early 2018 when the Bitcoin hype cycle unfolded. The value of the token rose from around $ 0.10 when it first went public to over $ 0.40 in May 2018, before the reality of the crypto winter set kicked in and the price of Nexo by September 2018 fell to $ 0.045.

Innovation seems to be driving Nexo's price movement

In late October, as Bitcoin was preparing to break out of the $ 10,000-12,000 range, Nexo launched its "Nexonomics" initiative to drive the rollout of its token and platform. The idea was to gradually roll out upgrades and new features on the platform by the end of 2020 to advance tokenomics and promote the usefulness of the token.

The team also introduced the Earn in NEXO program, which enables users to earn an additional 2% APY if they choose to pay any interest earned in NEXO.

Since the introduction of Nexonomics, the NEXO price has increased by more than 480%. Market capitalization rose from $ 68 million to its current value of $ 383 million over a three-month period.

During this time, Nexo also recorded a significant increase in trading volume from a daily average trading volume of around USD 5 million to a current volume of more than USD 30 million.

Nexo and DeFi tokens are trying to drive the Bitcoin wave higher

As the crypto market moves into the final weeks of 2020 and Bitcoin successively hits new all-time highs, Nexo appears to be well positioned to hold onto recent gains and potentially spike if interest in DeFi platforms is renewed.

In the past 6 months, a number of large institutions have opened sizable Bitcoin positions and the FOMO around crypto could lead projects like Nexo to receive special attention due to the niche they occupy and the reliable interest in deposits.

The views and opinions expressed are those of the author only and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading step is associated with risks. You should do your own research when making a decision.

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Melinda Martin