Blockchain-backed loan provider Nexo has offered to buy out rival SALT Lending as the unexpected departure of SALT’s CEO spurred rumors that the company is pulling an exit scam.
Nexo published on Friday a Letter of Intent (LOI) to purchase SALT’s remaining, qualifying assets, consisting of “loan receivables secured by corresponding collateral assets, brand assets and customer database.” If the offer is accepted, Nexo will provide a funding capacity of up to $2 million per customer of SALT’s outstanding loan applicants.
Nexo also wrote in its letter that it will “consider” accepting SALT tokens (SALT) as collateral or payment for the platform’s outstanding loans, better enabling the potential transition of users and assets. As for pre-existing memberships, Nexo has pledged to “honor” SALT users on its platform.
Announcing its offer on Twitter, Nexo described the move as “lending a helping hand” to its competition. In its LOI, the company explained:
“Nexo is concerned with the latest developments at SALT due to their potentially detrimental influence on the sentiment of investors and borrowers in the crypto‐backed lending industry, as well as the blockchain community in general. In order to mitigate the consequences, Nexo, its partners and affiliates could readily acquire remaining qualifying assets of SALT and provide liquidity to its community.”
Nexo did not disclose the price offered for the SALT assets, noting that this would be subject to the completion of a successful financial and legal due diligence process, and in line with possible impairments and nominal value adjustments.
SALT CEO departure triggers exit scam rumors
Nexo’s offer, which was widely dismissed as a publicity stunt within the SALT community, followed the unexpected departure of SALT’s CEO and founder, Sean Owen. He stepped down last week without explanation and was replaced with an “interim” president and CEO — Bill Sinclair.
In a blog post revealing the move, Sinclair struck a positive comment regarding SALT’s future:
“I’m looking forward to building a bridge of continued innovation between traditional financial services and blockchain. It’s been a pleasure to work with such smart and dedicated people, and we’re just getting started.”
The leadership change triggered rumors that SALT is pulling an exit scam — a fraudulent practice by unethical cryptocurrency promoters who vanish with investors’ money after an Initial Coin Offering (ICO).
While the rumors are currently unsubstantiated, members of the crypto community are beginning to question the project, as highlighted by a Wednesday post by Reddit user NachoKong.
“I told everyone months ago after some investigation and applying common sense that SALT LENDING was doomed and the writing of their demise was all over the walls. Well, it's coming true and yes, I told you so,” the warning read.
SALT has not yet publicly commented on either the exit scam rumors or Nexo’s acquisition offer.
SALT token
SALT — an abbreviation of Secured Automated Lending Platform — offers a peer-to-peer lending platform that allows cryptocurrency holders to use their Bitcoin (BTC) and Ethereum (ETH) as collateral for loans. The US-based company wrapped up a successful ICO in September, raising almost $50 million.
SALT tokens are ERC20 tokens that users spend to become members of the lending platform. Furthermore, users can redeem these tokens to pay down loan interest, receive better rates on loans and purchase items from SALT’s online store.
With a total market cap of $70.8 million, SALT holds the number 101 spot on Coins.Online’s cryptocurrency ranking. In the past 24 hours, the coin has climbed 4.82% to trade at $1.09.
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