Nexo Card

Overview

The Nexo Card represents a fundamentally different approach to crypto spending. While most crypto debit cards convert your cryptocurrency to fiat when you make a purchase, the Nexo Card instead extends a credit line backed by your crypto holdings. This means you never actually sell your Bitcoin, Ethereum, or other assets. Instead, you borrow against them. This is a crucial distinction for long-term crypto investors who believe in the future appreciation of their holdings. By using the Nexo Card, you can access the spending power of your portfolio without triggering a taxable event from selling. Your crypto remains in your Nexo account, earning interest in many cases, while the card provides a line of credit that you repay at your convenience. Nexo is a regulated financial institution with licenses in multiple jurisdictions and has served over 7 million users since its founding. The card is available in over 200 countries and works on the Mastercard network.

How the Credit Line Works

When you deposit crypto into your Nexo account, you are automatically assigned a credit limit based on the value of your collateral. The loan-to-value ratio varies by asset but typically ranges from 50% to 90%. For example, if you deposit $10,000 worth of Bitcoin, you might get a credit line of up to $5,000 to $9,000 depending on your loyalty tier and the specific asset. When you make a purchase with the Nexo Card, the amount is drawn from your credit line. You repay the borrowed amount plus interest at your own pace, as there are no minimum monthly payments. Interest is calculated daily and charged monthly, with rates starting as low as 0% for NEXO token holders at the highest loyalty tier. If the value of your collateral drops significantly due to market movements, Nexo may issue a margin call, requiring you to either add more collateral, repay part of the loan, or face partial liquidation. This risk should be carefully considered.

Interest Rates and Loyalty Tiers

Nexo's interest rates on credit line borrowing depend on your loyalty tier, which is determined by the percentage of your portfolio held in NEXO tokens. The Base tier (less than 1% in NEXO) has rates starting at 13.9% APR. The Silver tier (1-5% in NEXO) drops to 8.9%, Gold (5-10% in NEXO) to 6.9%, and the Platinum tier (10%+ in NEXO) offers rates as low as 0% APR on eligible amounts. The card also provides cashback on purchases, ranging from 0.5% at the Base tier to 2% at Platinum, paid in NEXO tokens or your choice of cryptocurrency. For users who maintain a significant NEXO position, the combination of 0% interest and 2% cashback makes this one of the most financially efficient ways to spend against your crypto portfolio.

Tax Advantages and Considerations

One of the most compelling reasons to use the Nexo Card is the potential tax benefit. In many jurisdictions, borrowing against your crypto is not considered a taxable event, unlike selling crypto which typically triggers capital gains tax. This means you can access the value of your appreciated crypto holdings without creating a tax liability. However, tax treatment varies by jurisdiction, and you should consult a tax professional for advice specific to your situation. It is also important to understand the liquidation risk. If the value of your collateral falls below the required maintenance level, Nexo will automatically liquidate a portion of your holdings to repay the loan. To mitigate this risk, many users maintain a conservative loan-to-value ratio, borrowing significantly less than their maximum credit line. Nexo provides clear warnings and allows you to set up alerts before liquidation levels are reached.

Supported Cryptocurrencies

Available Regions