‘Politically Motivated’ Allegations
The crypto lending platform Nexo has lodged a $3 billion arbitration claim against the Bulgarian government, accusing it of causing damage and missed opportunities. Nexo alleges that the Prosecutor General’s Office made politically motivated allegations against it in January 2023, which harmed the company’s reputation. The Bulgarian government dropped the charges in light of an investigation that found no evidence of criminal activity.
In a recent statement, Nexo revealed that it has submitted the claim to the Secretariat of the World Bank’s International Centre for Settlement of Investment Disputes. The company argues that the raid on its offices and subsequent investigations disrupted its planned activities, including a capital-raising initiative, and led to the collapse of a major sponsorship deal with a European football club.
Reputational and Financial Damages
Nexo’s co-founder, Antoni Trenchev, explained the decision to sue Bulgaria, stating that the company’s growth was hindered and opportunities were lost or delayed as a result of the allegations. He emphasized the need to seek financial compensation now that the Bulgarian Prosecutor’s Office has cleared Nexo of any wrongdoing. Trenchev also stated that the claim aims to send a message to individuals or regulators who abuse their power. He believes that a positive outcome for Nexo at ICSID will benefit all reputable actors in the blockchain industry.
Hot Take: Nexo Files $3 Billion Arbitration Claim Against Bulgaria
Cryptocurrency lending platform Nexo has taken legal action by submitting a $3 billion arbitration claim against the Bulgarian government. Nexo alleges that politically motivated allegations made by the Bulgarian Prosecutor General’s Office harmed its business prospects. Although the charges were dropped due to a lack of evidence, Nexo claims that the raid on its office and subsequent investigations disrupted its operations and caused financial and reputational damage. By pursuing this claim, Nexo aims to obtain compensation and serve as a warning to power-abusing individuals or regulators. The outcome of the arbitration will be closely watched by the blockchain community.
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