Paid Partnership: How Nexo Wants You To Build Wealth Using Crypto

Neil Steinhardt (0:00)

There is about to become a tremendous wealth transfer. So, you know, there's various studies out there. We have a study from CNBC that 35 to 106 trillion dollars is going to come from baby boomers into this new generation. When that liquidity comes to a generation that has high conviction about digital assets, I think that bodes really, really well for the industry and it bodes especially well for a company like Nexo.

Ryan S. Gladwin (0:24)

Hey, everyone, and welcome to a special Unchained Paid Partnership interview. My name is Ryan S. Gladwin, and I'm here with COO of US Nexo, Neil Steinhardt, to discuss its recently published report, The Future of Digital Wealth, which revealed that high net worth investors aren't using crypto to build wealth despite often owning it. How are you, Neil?

Neil Steinhardt (0:47)

Doing great. Pleasure to meet you, Ryan.

Ryan S. Gladwin (0:50)

Heads up, everyone. This conversation is sponsored content, paid for by Nexo. It was produced in partnership with them, separate from the Unchained newsroom.

So, Neil, an interesting finding in your report is that conviction isn't the main barrier stopping these investors from using crypto to build wealth. Instead, it's this friction. Could you tell me a bit more about the report? Why did you commission it? And what do you think about these findings?

Neil Steinhardt (1:16)

Sure. Let me start a little broader, maybe tell you a little bit about Nexo, and then I think we can talk about this report, which is really fascinating. Nexo is a premier digital asset wealth platform. We've been operating since 2018 We're available in over 200 jurisdictions. We have over $7 billion in assets under management, over 10 million users, and we've paid interest over $1.7 billion since our inception.

And the wealth report is really interesting because it is kind of the first of its kind measuring not crypto ownership but integration, right? So how integrated is your crypto into your long-term wealth building strategies? And how does it interact with an individual's life and plan? So to your point that you brought up, right, 67%-ish of the respondents own crypto. So, you know, ownership isn't a barrier, you know, if you look at the, you know, earlier cohorts, you know, in the study, they're a little more hesitant. Volatility is a big driver, right, for their hesitancy. But once you start owning it, it starts to behave much more like a regular asset, right? Where you're concerned about, you know, the cost, the tax implications, right?

Really normal, vanilla things that kind of help drive investment decisions.

Ryan S. Gladwin (2:42)

I think it's really interesting, the idea of using crypto to build wealth, rather than just investing in it. What is the difference here in using crypto to invest and to build wealth?

Neil Steinhardt (2:55)

Okay. Yeah. So Nexo is a wealth management platform, right? So our idea is to make it really easy for people to put their funds in securely.

We have yield generation products. We have lines of credit, right? We have lots of tools to help people build wealth. When we designed the report, we were really kind of looking at creating this proprietary crypto integration index, right? So not what is your sentiment, but really how are you using your crypto?

We looked at five different dimensions, and they're all equally weighted, right? So it would be your allocation size, your timeline horizon, your retirement integration, your risk perception, and substitution, right? How are you using your existing assets like equities and transferring them into crypto? And that would be one of the bigger indicators about how integrated you are for the long term. And so the average CII score across all three markets that we studied, which was the US, UK, and Argentina, was a 4.83. So most of the investors that we talked to were kind of in the middle of the market, but really weren't building wealth with it. Like less than 5% of the respondents were actually fully integrated.

Ryan S. Gladwin (4:07)

Were you surprised to see that?

Neil Steinhardt (4:10)

Well, I think it's a good start, right? It's a snapshot in time, and we're kind of early stage in this crypto adoption. And it's, I think, shows a lot of potential. I said, when you dive into the numbers and you start looking at the cohorts by age, right? You have much higher conviction in 18 to 25, 25 to 35, right? But you have less liquidity for those people, right? So I think that the general macro trend is really actually very encouraging. You know, you just have an older cohort like myself, right? That might be a little less inclined, but they might have their strategies in place already.