{"id":10107,"date":"2022-04-15T20:18:51","date_gmt":"2022-04-15T20:18:51","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/nft\/nftfi-eyes-massive-growth-for-nft-lending-cryptopunks-bayc-art-blocks-most-common-collateral\/"},"modified":"2022-04-15T20:18:53","modified_gmt":"2022-04-15T20:18:53","slug":"nftfi-eyes-massive-growth-for-nft-lending-cryptopunks-bayc-art-blocks-most-common-collateral","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/nft\/nftfi-eyes-massive-growth-for-nft-lending-cryptopunks-bayc-art-blocks-most-common-collateral\/","title":{"rendered":"NFTfi Eyes Massive Growth for NFT Lending; CryptoPunks, BAYC & Art Blocks Most Common Collateral"},"content":{"rendered":"
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Source: AdobeStock \/ Ilya<\/figcaption><\/figure>\n

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NFTfi<\/strong>, a company in the non-fungible token (NFT) lending industry, expects to see massive growth in the sector, where crypto holders get a chance to earn yields on their capital, or potentially secure a digital art piece from top collections like CryptoPunks<\/i> at steep discounts.<\/p>\n

The NFT lending market is still in its infancy, but there\u2019s ample room for growth, according to Stephen Young, the founder and CEO of NFTfi<\/strong>. He said that the company has already facilitated thousands of loans through its platform, helping NFT investors unlock capital they own in the form of digital art.<\/p>\n

\u201cAn NFT holder looking to get some liquidity for their asset comes to NFTfi, connects their wallet to the platform and lists an NFT to be used as collateral,\u201d Young told Cryptonews.com<\/i>.<\/p>\n

He added that the NFT is then locked into a smart contract escrow as soon as a borrower accepts an offer from a lender. While in escrow, the NFT cannot be accessed until either the loan and interest are repaid in full, or the borrower defaults.<\/p>\n

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In the case of a default, the lender takes over ownership of the NFT, potentially getting it at a steep discount.<\/p>\n<\/blockquote>\n

Describing the current state of the NFT lending market, Young said that NFT lending currently only makes up about 0.5% of the entire NFT market.<\/p>\n

When compared to traditional lending markets, which Young said are generally worth from 10% to 20% of the asset class itself, \u201cfurther strong growth\u201d can be expected in NFT lending as more people realize they can use their NFTs as collateral instead of selling them, Young opined.<\/p>\n

According to Young, several large loans have been facilitated via the peer-to-peer platform as of late, which earlier this month launched in an updated version.<\/p>\n

Among the biggest loans seen on the platform was from an NFT owner who put up 104 NFTs from the CryptoPunks<\/i> collection as collateral for a USD 8.32 million loan<\/a>. Other examples include a USD 1.4m loan<\/a> on a piece from the Autoglyph<\/i> collection, according to the company\u2019s Twitter account.<\/p>\n

Other notable projects have also been realized via the platform, with one person back in March getting an interest-free loan on his NFT from the popular Doodle<\/i> collection to fund a humanitarian relief effort for Ukrainian refugees.<\/p>\n

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\u201cA lender quickly stepped up with a 0% interest loan, and the user was able to drive the truck from Finland to the Poland\/Ukraine border,\u201d Young said.<\/p>\n<\/blockquote>\n

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This is the car he bought with the funds. It\u2019s now on its way to Ukraine along with medicine and other supplies paid for by Harri\u2019s charity initiative. pic.twitter.com\/7gnazDkNsn<\/a><\/p>\n

\u2014 NFTfi.com (@NFTfi) March 30, 2022<\/a><\/p><\/blockquote><\/div>\n

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According to NFTfi\u2019s CEO, CryptoPunks<\/i>, Bored Apes Yacht Club<\/i>, and Art Blocks<\/i> are the most popular NFT collections used as collateral, with each seeing loans worth tens of millions of US dollars facilitated over the platform.<\/p>\n

As this is a marketplace that facilitates loans, he said that borrowers and lenders are free to set their own terms. The parties use both Wrapped ETH (wETH) and the stablecoin DAI to make transactions.<\/p>\n

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\u201cNFT sales overall may be fluctuating, but it\u2019s clear that the lending market is here to stay,\u201d the NFTfi CEO said.<\/p>\n<\/blockquote>\n

____<\/p>\n

<\/strong>
– How NFT Finance Accelerates NFT Mass Adoption
– What\u2019s Still Holding NFTs Back & How to Fix It<\/p>\n

– How NFT Finance Accelerates NFT Mass Adoption
– NFT Market Shows Signs of Maturing as Sales Expand Beyond Ethereum<\/p>\n

– Two New ERC Standards Aim to Standardize Tokenized Vaults and Add Refund Option to NFTs
– 6 NFT Use Cases That Will (Probably) Remain After the Hype Dies Down<\/p>\n

– SEC\u2019s Gensler Wants Crypto Exchanges, Lending Platforms to \u2018Come and Work with\u2019 Regulators
– Changes in Crypto Lending<\/p>\n<\/p><\/div>\n