Nubank initially announced the issuance of the platform currency Nucoin in 2022, and it was officially launched in March last year. However, it immediately stopped the trading function within two years. The encryption-related loyalty program did not seem to bring surprising changes to Web2 companies.
(Starbucks ends NFT reward program without warning: to prepare for the next phase of the plan)
To prevent market fluctuations, Nubank suspends Nucoin trading
According to Nubank’s announcement, users will not be able to trade Nucoin within the Nucoin application from now on to avoid fluctuations in the value of Nucoin in the market.
Nucoin has been developing on a trajectory similar to platform coins. Last year, the official emphasized that in order to improve on-chain transparency, such as providing personal wallets and transaction inquiries, the block browser Nucoin Explorer was launched. As a utility token in the loyalty program, Nucoin is not only It can provide relevant benefits to holders, and users can also freeze (similar to staking) Nucoin to unlock more benefits, or directly exchange it for cash through the liquidity pool.
(Brazilian digital bank Nubank cooperates with Polygon and plans to airdrop and issue the platform currency Nucoin next year)
Can be exchanged for BTC, USDC before 12 months
After announcing the termination of the transaction function, Nucoin will only be used to unlock various benefits and rewards within the Nubank ecosystem, including discounts on Nubank Shopping and various experiential offers promoted by the bank.
Users can exchange Nucoin for BTC or USDC before December 9 this year, and users who perform the exchange can also participate in a lottery.
Similar to Starbucks’ announcement, officials emphasized that Nucoin will prepare for the next phase.
Non-performing loans hit record high, raising questions
Nubank’s halt to Nucoin trading comes at a time when its financial situation is under scrutiny. Although Nubank's share price has risen more than 60% this year, asset management company Persevera chose to sell off all positions in June, and JPMorgan Chase and UBS also downgraded Nubank's rating to "neutral" in July, citing deterioration in asset quality.
Persevera Portfolio Manager Fernando Fontoura said:
Concerns over credit quality have led us to distance ourselves from Nubank.
According to Bloomberg, Nubank’s non-performing loans overdue for more than 90 days hit a record high of 7% in the second quarter (exceeding the peer average of 5.5%), while its non-performing loan provisions also decreased from US$831 million to US$760 million.
Regarding the above doubts, Nubank Chief Operating Officer Youssef Lahrech explained in the earnings call that Nubank focuses more on long-term strategies rather than short-term non-performing loan indicators.
Buffett's Berkshire Hathaway has invested in Nubank twice, which has attracted attention in the crypto field to Nubank's development.
This article Is the Web3 Loyalty Program useless? Brazilian Digital Bank suspends “Nucoin” transactions first appeared on Chain News ABMedia.
