Can Nexo have a stop-loss option to liquidate collateral once a certain price target is reached rather than a certain USD portfolio value?

That’s a good suggestion but it has some challenges when it comes to implementation. When things turn sour in the crypto space and prices start dropping, liquidity dries up extremely quickly which means we can’t guarantee we’ll be able to execute stop-losses on time. Essentially if an asset pierces through the stop-loss price too fast somebody will have to cover the extra losses and Nexo is not in a position to do this, neither do we want to pass on such costs to our clients.

However, we have been piloting products with different options and option strategies that come close to this with some of our institutional clients. To implement this for retail clients might take a long time and a lot more liquidity for us to be able to offer a product that works and makes sense.

Source: Antoni Talks Nexo with Scott Melker, The Wolf of All Streets
August 21, 2022
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