Quarterly close to a billion in NFT loans in first month

Users of NFT lending and borrowing protocols Blend has taken on about a quarter billion dollars in debt. And this is only Blend’s first month. The market has taken note, and Binance has also moved into NFT lending. How worried should Blend’s competitors be?

Blend, the NFT lending and borrowing protocol developed by Blur in partnership with Paradigm, claims to have had an impressive first month. According to a report by Nansen, since its launch on May 1st, Blend has facilitated over 15,800 loans totaling 123,500 ETH ($224.4 million).

bumper first month

Blend stands out from its competitors with its unique features. It charges no fees to borrowers and lenders, eliminates the need for predictions, and does not enforce loan termination. Borrowers can secure fixed rate ETH loans against their NFTs without worrying about repayment deadlines or collateral liquidation. Its launch has been a huge contributor to the ongoing financialization of NFTs.

The lending and borrowing functionality of the protocol initially covers popular NFT collections such as Cryptopunks, Azukis and Milde, with plans for expansion. Blend’s fixed-term lending approach simplifies the protocol by removing oracle dependency and allowing lenders to measure risk levels through loan-to-value (LTV) ratios and interest rates.

Blend’s peer-to-peer expiration sets it apart from other peer-to-peer protocols. The purpose of the protocol is to offer increased flexibility. Lenders can exit positions at any time through refinancing auctions, reducing their risk exposure and fostering an efficient market. Loans on Blend remain active until borrowers trigger refinance auctions or pay the outstanding balance in full.

Not everyone sells. But Brent Xu, co-founder of borrowing and lending platform Umi, believes Blend is a step forward for the industry. “Lending for NFTs brings new yield generation opportunities on-chain that will create new markets for the DeFi ecosystem.”

Blend’s success should worry competitors

“One of the most prominent advantages of NFT technology is its ability to bring physical entities such as deeds and bonds on-chain,” Xu explained. “As industry leaders deliver on this promise, we will see a more diverse array of use cases.”

However, Charles Wayne, co-founder of Galax, believes competitors should worry about Blend’s impressive liquidity and trading volume.

“Liquidity is always an issue for blue chip NFT holders. The launch of Blend was expected and serves the needs of the big whales in the Blend market,” he said.

“Certainly, the competitive advantage is amplified by the fact that this is for Blur, which is now one of the largest NFT markets. Adding more liquidity and flexibility to NFT assets has always been a demand of the NFT community, especially whales. For “

However, this week exchange giant Binance announced that it is also getting in on the NFT lending craze.

Currently, the exchange has limited the service to four collections: BAYC, MAYC, Azuki, and Doodles. Initially, the platform is keeping the annual interest rate at 3.36% and will later increase it to 11.20%. The loan-to-value ratio is 40% for Doodle, 50% for Azuki and MAYC, and 60% for BAYC Collection.


In compliance with The Trust Project guidelines, BeInCrypto is committed to fair, transparent reporting. The purpose of this news article is to provide accurate, timely information. However, readers are advised to independently verify the facts and consult a professional before making any decisions based on this content.

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