Reported by: Mat Di Salvo

Funds are flowing out of crypto lender Nexo following news that prosecutors in Bulgaria are investigating the company for fraud, according to blockchain analytics firms.

Nexo is a British digital asset platform that loans out client funds and uses the proceeds to pay interest. (Disclosure: Nexo is one of Decrypt’s 22 investors.)

Earlier today, the company said it was cooperating with the relevant authorities and regulators after news broke that Bulgarian prosecutors raided its Sofia offices as part of a financial crimes investigation. 

“There are authorities at one of Nexo’s offices in Bulgaria, which is as you know the most corrupt country in the EU,” Nexo co-founder Antoni Trenchev told Decryptvia email earlier today. “They are making AML and tax-related inquiries about a Bulgarian entity of the group that is not customer-facing but only has back-office functions—payroll, customer support, and compliance.”

Now, funds are flowing out of the platform, according to blockchain analysts. Blockchain intelligence firm Arkham tweeted that hundreds of thousands of dollars had flowed out of the platform in 24 hours. Nexo, however, says the outflows are not out of the ordinary. “We do not register abnormal activity in regards to withdrawals. It’s all business as usual,” a Nexo representative told Decrypt.

Read full report: https://decrypt.co/119066/nexo-withdrawals-office-raid-money-laundering-investigation