Nuo Review 2022
Nuo is a non-custodial decentralised financial (DeFi) debt market that allows its users to lend, borrow, margin trade and swap ETH and ERC20 cryptocurrencies. It is built on top of the Ethereum network, using its own Nuo protocol for smart contracts used on its platform. This review will discuss its range of services, advantages, security, pricing and more.
The Nuo Network platform was established in May 2018 to build a decentralised lending and borrowing platform that is accessible to all. Publicly launched in 2019, within six months Nuo had become the number one DeFi protocol from Asia and number five worldwide for their total value locked (TVL). It claims to be the first DeFi platform to allow for “gasless” transactions. Being a decentralised platform means that Nuo does not follow KYC (know your customer) and AML (anti-money-laundering), unlike a normal bank or broker.
The Nuo Network supports nine tokens on top of ETH, being DAI, MKR, WBTC, KNC, BAT, REP, ZRX and USDC. It offers an easy way for its users to earn passive income with their held ERC20 tokens, as well as allowing for leverage trading.
The Nuo DeFi app makes it simple and easy to deposit your crypto to be lent out to borrowers, creating what is called a “debt reserve”. When you create a debt reserve, it is pooled with other debt reserves on the Nuo platform to be lent out to borrowers, which then allows the debt reserve to earn interest from daily loan repayments. It is worth noting that your debt reserves will only start earning interest after one day and earnings will be added every day at midnight thereafter.
Cancelling your debt reserve is simple and easy, done through a few quick clicks on the Nuo Network platform. Once that is done, the entire reserve balance amount and the interest earned is transferred back into your Nuo account or wallet. Note that, in order to get your tokens back from the reserve pool, the requested amount needs to be available (i.e. not lent out to borrowers, or not utilised). If this is not the case, you will continue to earn interest on your lent amount until the correct amount of tokens become available, at which point the interest and your tokens will be transferred to you.
The lend APR shown on the Nuo platform may not be fully representative of the amount of interest you earn with your deposited tokens. This is due to that APR being representative of past and predicted future interest, which may not match actual future rates. If no users are borrowing any of the types of tokens that you have deposited, then no interest can be collected and paid out to you. The amount of interest paid out is also dependent on your stake in the debt reserve pool.
On the Nuo Network, borrowing works much the same as other DeFi debt markets. To borrow an amount of ETH or any ERC20 token on Nuo, you must put up collateral that is equivalent to 1.5x of the value of the loan. Once set up, the funds are deposited directly into your Nuo account, from which you are free to transfer the tokens into your wallets.
Any loan you take out on Nuo is over-collateralised and you have to maintain the collateral above a certain margin to avoid it being liquidated. To make it easier for users to know when their collateral is at risk of being liquidated, the loan status is split into three categories: safe region, critical region and hard stop.
If your loan status is within the safe region, then your collateral cannot be auto-liquidated. If it is in the critical region, however, then Nuo workers tracking active loans can manually trigger a liquidation. If liquidation is triggered manually when it is in the critical region, then you, as a borrower, will not lose more collateral than you have committed. A loan in the hard stop region will be auto-liquidated and you may lose more collateral than you initially committed.
There is a buffer between the criterial region and a hard stop of 10% across all loans.
Calculating Interest Rates
Every loan on Nuo has a fixed interest that you must repay. The interest rate is calculated based on the number of assets that are available in the lending pool at the time of taking out the loan. You are required to pay out 30 days worth of interest, which is paid even if the loan is repaid before the 30 days or the loan is auto-liquidated.
It is worth noting that the maximum interest rate is 50% and that your interest rate does not change once you start a smart contract.
On Nuo, you can carry out margin trading of cryptocurrencies using up to 1:3 leverage. To do so, you must first select a trading pair, i.e. choose which currency to long/short and what currency to convert it to. Much like borrowing tokens, as a trader, you must put up collateral to open a position. The platform makes it easy to check the liquidation price of the crypto (which is higher/lower than the entry price, depending on if going for a short/long position), however, it should be noted that the price may change with the increase or decrease in value of the crypto in question.
Before confirming the margin trade position, the total interest that you must pay will be displayed along with a confirmation of the interest you must pay (regardless of how long you keep your position open) after opening. Your position will by default be open for 30 days unless exited early. You should also be aware that the stop loss is at 80%, which, once reached, will cause the position to be auto-liquidated. Any remaining collateral after the liquidation will be transferred to your Nuo account or wallet.
Nuo Network offers a platform feature able to swap one kind of ERC20 crypto token for another. It works by splitting your swap order across different decentralised exchanges (DEXs) with high liquidity to get the best price for your swap. Nuo supports the swap feature for 13 types of ERC20 tokens.
This functionality gives further control to you by allowing you to set a maximum slippage percentage for the swap order. This prevents your order from being carried out if the swap’s slippage exceeds the set limit, preventing significant unwanted losses. The slippage is reduced on Nuo by splitting the swap order between different DEXs (e.g. Kyber Swap, Uniswap, Oasis) to provide you with the best prices for your chosen tokens.
Nuo does not charge any gas fees for borrowing or lending cryptocurrencies on its platform. This is different from many other DeFi platforms, as most do incur fees for such trades. However, every margin trade and swap conducted on the platform incurs a 0.6% and 0.3% transaction cost respectively, which is used to cover the gas fees of any meta-transactions. You should be aware that these transaction costs are subject to change, should the gas fees on the Ethereum network be adjusted.
Due to the non-custodial nature of Nuo and the fact that all transactions happen on-chain, there is no “counterparty” risk associated with the smart contracts used, unlike standard centralised crypto lending. The over-collateralisation of loans means that there is less risk involved in lending out your tokens. In the event of the liquidated collateral not being enough to cover the value of the lent funds or large price volatility, the difference can be fully or partially offset using Nuo’s insurance fund. This fund allows lenders to insure themselves by contributing a portion of their gains to it.
The main risks involved include the compromise of the smart contracts protocol used by Nuo and flash crashes/surges in the crypto price. Both of these risks are acknowledged by the platform and steps have been taken to minimise them. The Nuo platform’s smart contracts protocol has been previously audited by Quantstamp — a firm specialising in security audits.
It should be noted that Nuo considers the technology used on its platform as experimental and it is suggested that you as a user should make yourself familiar with how the system works before using it.
The platform offers 24/7 support to clients through the use of live chat on their website, as well as through general FAQs that aim to explain the core Nuo Network concepts.
Before beginning trading with Nuo, you must have a supported Ethereum wallet or a registered account on the platform.
Registering is quick and easy, only requiring an email, username and password to get started. Once an account has been created, it is labelled as “temporary” for six hours. You must deposit funds in the form of supported cryptocurrencies into the account during those six hours to label the account as permanent. If this is not done in the time frame, the account is deregistered and you must create another. Nuo Network recognises that funds sometimes may take longer than six hours to deposit and, if that is the case, they can reinstate your deregistered account if you contact them directly. By using a supported Ethereum wallet you can bypass account creation altogether, allowing you to manage your funds from one place.
Funds can be deposited from external crypto wallets by using your Nuo account’s deposit address, which can be found under the deposit tab on the platform.
Like most DeFi debt markets, Nuo is not registered or licensed with any regulatory body. This may change in the future, should any laws local to the company be applied (i.e. Singapore), however, some caution should be taken before trading on this platform. Nuo makes use of partner exchanges like Uniswap and Kyber Network to facilitate trading.
The Nuo Network DeFi market, as of the 3rd of August 2020, had paused their new order creations indefinitely to momentarily shift focus onto the development of an updated new platform. While there is no set date for this finishing, the gas-free crypto lending and staking services are competitive and the DeFi margin trading platform could be right for you.
What Is DeFi?
DeFi stands for decentralised finance, which refers to financial applications in crypto/blockchain that allow for users to interact with each other without a “middleman” (i.e. peer-to-peer trades).
What Is Crypto?
Cryptocurrency, or crypto, is a form of digital asset based on a network that is distributed across several devices. Cryptocurrency is decentralised and is not controlled by any single authority or group.
Are All Crypto Wallets Accepted On Nuo?
No, only Metamask and Web3 based wallets can be used on Nuo Network for its lending, borrowing and margin trading services.
Can I Use Nuo?
Not currently. As it stands, Nuo is in the process of being upgraded and so is not active.
Do I Need To Verify My Identity With Nuo?
No. Nuo is a decentralised financial market, which does not require verification (no KYC or AML).
Is Nuo Regulated By Any Authority?
No. Nuo is not registered or licensed with any regulatory body. Before using the platform, it is suggested that you make yourself familiar with it and the risks involved.
Nuo accepts traders from Australia, Thailand, Canada, United States, United Kingdom, South Africa, Singapore, Hong Kong, India, France, Germany, Norway, Sweden, Italy, Denmark, United Arab Emirates, Saudi Arabia, Kuwait, Luxembourg, Qatar and most other countries.
Alternatives to Nuo
If you are looking for alternatives to Nuo we have compiled a list of the top 5 brokers that are similar to Nuo below. This list of brokers like Nuo is in order of similarity and only includes companies that accept traders from your location.
- LQDFX – LQDFX offers online trading with multiple STP accounts and MT4 analysis tools.
- Paxful – Paxful is a crypto trading exchange and digital wallet offering low fees and easy sign-up.
- Uphold – Trading in the Uphold environment offers a one-stop-shop for all your crypto requirements.
- ZacksTrade – ZacksTrade: Built for the active trader. Stock & ETF trades from $3, 75¢ options contracts and 3.56% margin rate (lower on occasion)
- Coinmama – Coinmama is a popular cryptocurrency trading exchange, aimed at beginners and high-net worth investors.
|Nuo is a decentralised finance platform with crypto lending, borrowing and leverage trading services for a range of ERC20 tokens.|
Nuo vs Other Brokers
Compare Nuo with any other broker by selecting the other broker below.