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What the numbers say: NFT loan volumes skyrocketed over the last several weeks as major NFT marketplaces adopted new lending features and platforms. The weekly loan volume reached a six-month high with $67.18M between May 1 and May 7, up from $19.56M at the beginning of the year. The figure further saw a jump last week, nearly doubling to $114.25M. What it means: NFT lending allows NFT holders to borrow money using their NFT assets as collateral. Relevance: Amid the increased interest in NFT lending among investors, Binance, the largest crypto exchange by trading volume, has recently integrated an NFT lending feature into its NFT marketplace. The feature will allow users to borrow Ether (ETH) by using their NFTs as collateral within the platform. NFT loans on Binance will also generate an annual interest rate of 7.91%. In addition, the platform said it would charge no gas fees for the transactions related to the lending process. Brands that should care: NFT lending mainly gained traction shortly after the NFT marketplace Blur launched a perpetual NFT lending platform dubbed Blend at the beginning of May. Blur, launched in October last year, had already proved its competitive power when it surpassed the leading NFT marketplace OpenSea in trading volume in February. The platform's success forced its rivals to launch new features to compete with Blur. However, with its lending platform, the popular marketplace received almost all the share of the cake. In the week of May 15, when NFT loans peaked, Blur's lending protocol hosted 83% of all the loan volumes. |
