Arrington XRP Capital-backed Instant crypto loans firm Nexo is releasing a Mastercard-branded Cryptocurrency credit card. The development was announced in a press release shared on August 2. 
Nexo has teamed up with an unknown mediator to issue the card, which provides a way for users to “spend the value of their crypto without actually spending it,” stated firm partner Antoni Trenchev. Moreover, the card doesn’t include any annual and monthly and foreign exchange charges. Explaining in detail about how this will work, Nexo said: 

“When using the Nexo Card to purchase goods and services, you actually pay using your Nexo flexible open-ended revolving credit line that is backed with your crypto holdings and thus not selling any of them, which is giving you the freedom to spend today and sell your holdings whenever you want in the future to pay back the loan.”

Nexo also offers a fully automated Instant Crypto Credit Line Service that allows crypto owners to borrow from a list of digital currencies such as Bitcoin (BTC), Ether (ETH), Ripple (XRP), Litecoin (LTC), etc.
Nexo also allows users to earn interest on fiat currencies such as the United States dollar, euro, British Pound, and stablecoins.
As compared to other crypto cards such as TenX and Cypterium which covert cryptocurrencies to fiat for every transaction, Nexo collateralizes users’ crypto and provides them with a fiat loan of the same amount. Since its launch, the startup has launched more than $700 million in crypto-collateralized loans to more than 2000 clients. Currently, these loans can be used to make purchases at merchants that accept Mastercard via Co-branding.
After swiping, an oracle ensures that the user possesses sufficient collateral to cover the purchase, instantly executes a loan and settles the transaction in fiat. Trenchev makes sure that the card issuer is licensed within the European Economic Area. 
By partnering with more intermediaries, Nexo’s goal is to expand to the U.S. and Asia by the end of this year.
The cards are available regardless of the client’s credit history, as the stacked collateral reduces default risk. In the same way, Interest rates are kept between 8 and 24 APR depending on the loan structure and local regulations.
Users have an option to repay their loans in crypto or fiat. Also, Nexo token’s interest rates decrease to 8%. Moreover, minimum payments will be removed if the value of bitcoin increases. The main reason is here is that the credit line is “dynamic” this means as the value of the client’s collateralized assets increases relative to the market, the fiat debt decreases.
Moreover, crypto entrepreneur Brock Pierce pawned a house in Amsterdam via a $1.2 million line of credit via Nexo, and hasn’t made a single repayment due to the rising value of bitcoin as he took the loan, Trenchev said. 

On the contrary, if the cryptocurrencies crash, “users will either have to deposit more crypto, pay a part of their loan to reduce exposure, or sell a portion of their collateral to restore the loan-to-value ratio,” Trenchev said. 

The firm conforms with know your customer protocol follows international sanctions and has incorporated with blockchain investigators Chainalysis to check if collateralized crypto has been ill-gotten, it says.
Nexo has earlier paid out dividends of 30 percent on $3 million of profit made during its first seven months in operation to token holders.