Nexo has filed a lawsuit against the Cayman Islands Monetary Authority, or CIMA, for denying its registration as a virtual asset service provider in the island nation.
The crypto lender asked the court to overturn the financial regulator’s decision as it was suitable to provide crypto services to Cayman Islands residents.
According to court documents, Nexo applied to CIMA in January 2021, providing additional information at the request of the regulator. However, the monetary authority asked for clarification on the application last October, citing certain legal and regulatory matters as noted in the news media that Nexo had not disclosed. It rejected the application in December.
The Authority breached its constitutional and statutory duty to provide comprehensible, satisfactory and sufficiently detailed reasons for its Refusal Decision, alleged Nexo.
Nexo claimed that CIMA had placed too much weight on regulators posing enforcement actions on the crypto lender, citing incidents in United Kingdom courts. State-level regulators in the United States also filed cease and desist orders against Nexo in 2022, but Nexo says in its lawsuit that this doesn’t mean it acted improperly.
