Cryptocurrency lender Nexo has opened PAX Gold (PAXG) credit score line for retail traders.
Revealing the information completely to The Block on Wednesday, Nexo mentioned the transfer would permit all purchasers to entry the PAXG token as a collateral choice. Beforehand, the providing was solely out there for institutional purchasers.
PAXG is an ERC-20 token constructed on the Ethereum blockchain. Every token is backed by one troy ounce of a 400 troy ounces London Good Supply gold bar, saved in Brink’s vaults.
Antoni Trenchev, co-founder and managing associate of Nexo, instructed The Block that each one purchasers can now “seamlessly purchase gold and borrow towards it.”
“With Nexo and PAXG, you may spend money on bodily gold, represented by the PAXG token. You’ll be able to then pledge your tokens as collateral and get 70% of the funding quantity as a mortgage with an annual proportion charge (APR) beginning at 5.9% and purchase much more gold,” Trenchev instructed The Block.
He mentioned the providing has been prolonged to retail purchasers due to “phenomenal” demand from them. “Particularly in high-volatility occasions, as within the current, gold is wanted by lots of our retail purchasers,” he mentioned.
When requested what number of institutional purchasers are at present choosing the providing, Trenchev mentioned “a number of dozen.”
Nexo claims to have a complete of over 650,000 customers, each institutional and retail.
Final December, Nexo bought $5 million price of PAXG tokens. On the time, the agency additionally added the token for its “Earn Curiosity” product to pay customers as much as 8% per yr of curiosity on gold.