A loan thanks to digital art? – The success of non-fungible tokens (NFTs) is still going strong and is starting to invade areas such as video games. But once your unique tokens were acquired, the only option left was to keep them or resell them. Nexo has just added a new possibility: take out a loan by pledging your NFTs.
NEXO offers you loans against Punks or Monkeys
Decentralized finance (DeFi) and its juicy returns, which have been enabled by blockchain networks – Ethereum (ETH) in the lead of course – are no longer introduced. The company Nexo also offers very interesting returns on cryptocurrencies, but in a centralized way (CeFi).
In addition to offering interest (sometimes up to double digits) on the crypto-assets deposited by its users, Nexo also allows them to take out loans – in stablecoins or dollars/euros – by putting in counterpart bitcoins (BTC) or any other supported altcoin.
This December 17, 2021, Nexo innovates again and offers this time to lend you money against your NFTs. Specifically, NFTs from the CryptoPunks and Bored Ape Yacht Club (BAYC) series can be used as collateral for loans.
With your NFTs and NEXOs, borrow automatically!
As with loans offered against a traditional cryptocurrency counterparty, borrowing with NFTs will be fully automatic and direct, without going through the “application review” process practiced by traditional banks.
Quite an addition in liquidity for NFTs, which now no longer require finding a buyer rich enough to put the sometimes mind-blowing prices these unique tokens reach.
In more detail, NFT owners will be able to borrow up to 20% of the value of their token against USDT, USDC stablecoins or fiat currencies (via bank transfer).
For now, Nexo is not taking any risks, accepting only NFTs from the two most famous collections in the industry, as well as those worth more than $500,000. However, the company hopes to be able to quickly diversify the offer of non-fungible tokens accepted for these loans and to reduce their minimum required value, once the new service is up and running.
In any case, NFT’s long-term HODLers will certainly appreciate Nexo’s approach, which provides them with an additional liquidity opportunity for their digital art tokens, without having to part with them. Another good news from Nexo, after its recent partnership with Fidelity Digital Assets to offer new services to institutional investors.