Digital asset lending platform Nexo has bought a stake in a holding company owned by a federal bank in the United States, a move Nexo says will improve its ability to serve retail and institutional clients.
Nexo revealed on Tuesday that it had acquired a stake in Hulett Bancorp, a holding company that owns Summit National Bank, a federal bank, regulated by the Office of the Comptroller of the Currency. Terms of Nexo’s acquisition and its stake in Hulett Bancorp have not been disclosed.
The acquisition allows Nexo and its clients to open bank accounts at Summit National Bank. Nexo’s US-based retail and institutional clients will also have access to asset-backed loans, card products, and custody and deposit solutions offered through Summit.
Founded in 1984, Summit National Bank was originally incorporated in Wyoming as Hulett National Bank. The financial institution has four locations in Montana and Idaho.
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As part of the new business relationship, Nexo co-founder and managing partner Kalin Metodiev will serve on the board of directors of Summit National Bank. Forrest Gilman, who chairs Summit’s board, said Nexo will help transform the bank “into a full-fledged fintech bank.”
Nexo has prioritized acquisitions as a way to strengthen its position amid the bear market. As Cointelegraph reported, the firm hired Citibank in June to advise it on acquiring struggling crypto firms. At the time, the firm said it believed the “cryptocurrency space is about to enter a phase of massive consolidation” following the implosion of major lending platforms.
By acquiring a stake in Hulett Bancorp, Nexo has hinted that it wants to expand its regulated cryptocurrency offering and attract new users from traditional finance. This comes at a time when several states have taken legal action against the crypto lender for allegedly failing to register their interest accounts.
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