Available as part of the buy-a-box promo in Core Set 20192, Nexus of Fate has always been very powerful due to the fact that it a) gives you an extra turn and b) goes back into your library should it ever be put in the graveyard.
The main reason for the ban, though, is not that the card is too powerful but that it disrupts play. To quote Wizards:
Win conditions sometimes take a half hour or more to finish, with the majority or all of that time being non-interactive
Due to the way MTG Arena works, it could take a long time to resolve loops with Nexus of Fate leaving the other player waiting (and often being timed out as the fuse counts down during all the numerous pauses). This is obviously not that fun, especially in a format which is geared around matches that take an average of 6 minutes.
The card has not been banned in Traditional formats on MTG Arena as these are designed to be more “authentic-to-tabletop” including best-of-three matches, sideboards, and the same banned and restricted list.
As the card was banned purely for the way it causes slowdown within MTG Arena games, it makes sense to remove it from the formats that are quickest. I’ve personally suffered against Nexus of Fate in Arena Standard matchups and whilst I agree it was causing slowdown issues it’s a shame that there wasn’t a technical way of resolving this over banning the card. The reality is that any code changes to the looping systems of MTG Arena will likely take several months to develop by which point Nexus of Fate will have dropped out of rotation3.
On MTG Arena, Arena Standard is any format that is best-of-one whilst Traditional encompasses all best-of-three formats. ↩︎
It was also given to you for free if you bought a Core Set 2019 box of boosters on MTG Arena but you could always just exchange a Mythic Rare wildcard to get them. ↩︎
Ixalan, Rivals of Ixalan, Dominaria, and Core Set 2019 all disappear from Standard at some point around October 2019 leaving us with Guilds of Ravnica, Ravnica Allegiance, and the as-yet-unreleased War of the Spark. It’ll be interesting to see how Arena handles that purge! ↩︎