Brazil’s neobank Nubank has suspended trading its of native token, Nucoin.
“From now on, the ability to buy and sell Nucoins within the app will no longer be available. Trading has been suspended, and Nucoins will only be used for redeeming benefits and products within the app,”
Nubank noted in a recent blog post.
Nucoin was launched on the Polygon (POL) network in late 2022 and was introduced as part of a rewards program designed to provide customers with exclusive perks, such as discounts and special benefits.
The bank claimed its latest decision was “to avoid possible fluctuations in the value of Nucoins on the market”. It offered users holding at least 1,745 Nucoins the option to redeem their tokens for Bitcoin or USD Coin until December 9. After the deadline, unredeemed Nucoins will remain usable for various in-app benefits.
Although the exact motive behind the decision remains uncertain, the abrupt policy change occurs amid growing concerns about Nubank’s financial stability, according to Bloomberg.
Nubank’s financial health has reportedly come under scrutiny, with its portfolio of non-performing loans surpassing industry norms and raising concerns about asset quality. Despite the bank’s stock climbing over 60% this year, some analysts believe it is “overvalued,” deepening doubts about the company’s overall stability.
Meanwhile, the Brazilian government has been setting up frameworks to regulate the country’s growing crypto ecosystem. The country’s Central Bank recently announced a phased approach to regulating crypto-assets and virtual asset service providers. The Central Bank aims to roll out its regulatory proposals by the end of the year.
Nagel Lisanias Paulino, from the Financial System Regulation Department at the Bank, emphasized in the official statement that the upcoming regulatory frameworks are designed to enhance oversight on improper practices involving digital assets. The new regulations are expected to protect consumers and industry stakeholders from fraud and scams and contribute to a more secure and transparent crypto market in Brazil.
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