Crypto Company Nexo Sues Government Bulgaria For IDR 47.5 Trillion!

The crypto lending company Nexo was ransacked by Bulgarian authorities. (Photo; Doc. Nexo)

JAKARTA - Nexo AG, a Swiss-based crypto lending platform, has filed an international arbitration charge of $3 billion (Rp 47.5 trillion) against the Republic of Bulgaria. This demand is related to searches conducted by the Bulgarian Attorney General's Office in 2023, which is suspected of being politically motivated and damaged Nexo's reputation.

According to Nexo's official statement on January 24, the arbitration charges were filed at the International Center for Settlement of Investment Disputes (ICSID), an arbitration agency under the World Bank. Nexo claims that Bulgaria's government actions violate bilateral investment agreements between Bulgaria and Switzerland, as well as violate international law.

Nexo is one of the largest crypto lending platforms in the world, offering services such as instant credit, high interest, and crypto-based credit cards. Nexo was founded in 2018 by Antoni Trenchev, a businessman and former Bulgarian lawmaker.

In November 2023, the Nexo office in Sofia, Bulgaria, was searched by police officers and prosecutors, who confiscated equipment and documents. Nexo is accused of money laundering and violating economic sanctions against Russia. The charges were later lifted after the investigation found no evidence of any criminal activity.

Nexo said the search and investigation had caused losses to the company. Nexo admitted that he failed to get major sponsorships from European football clubs, as well as experienced delays in the development of new products and services.

Trenchev, co-founder of Nexo, said that the arbitration demands aim to get compensation for substantial reputation and financial losses. He also hopes that these demands can serve as a warning to individuals or regulators who abuse power and interfere with the development of the crypto industry.

"We hope that this arbitration process will provide clarification and legal certainty for all ethical actors in the blockchain space, and will encourage the Bulgarian government to respect the rights of foreign investors and adopt crypto-friendly regulations," Trenchev said.

The Nexo case presents challenges faced by crypto entities in dealing with different regulatory actions in various countries. Several countries, such as El Salvador, have recognized Bitcoin as legal tender, while several other countries, such as China, have strictly banned crypto activity. In Indonesia itself, crypto is considered a trading commodity, but not a legal tender.