Kraken will start issuing loans secured by NFT

Cryptocurrency exchange Kraken is developing a marketplace where users will be able to borrow against collateral in the form of NFT.

Crypto exchange Kraken is gearing up to join the hype around non-fungible tokens (NFT) by deploying a marketplace. Bloomberg writes about this with reference to the head of Kraken Jesse Powell.

According to Powell, in the marketplace, users will not only be able to trade and store NFTs, but even use tokens to obtain a loan.

If you contribute CryptoPunk to Kraken, we want to be able to reflect token value in your account. And if you want, then even borrow funds for it, ”- said Powell.

NFT liquidity will be determined using a special program. However, it remains unclear whether it will be possible to get a loan in dollars or only in cryptocurrency. The terms of such loans are also unclear. When the exchange plans to launch the NFT marketplace, Powell did not elaborate either.

Earlier, a startup with a similar idea raised $ 15 million in investment. NFT service Arcade co-founder Gabe Frank told the media that the startup has attracted investments from Pantera Capital, Castle Island Ventures, Franklin Templeton, heads of BlockFi and Quantstamp. The platform allows you to tokenize several NFTs at once into one token to receive a loan in stablecoins based on the asset.

In November 2021, analysts of the NonFungible service announced a liquidity crisis for NFTs issued by celebrities. As an example, tokens from Grimes called “Earth” are given. The Canadian singer raised $ 5.8 million by issuing 303 NFT tokens. However, for buyers, Grimes tokens were no longer  profitable. For example, according to the NFT marketplace Nifty Gateway, some Earth owners sold tokens below the $ 1,000 threshold, even though the collection’s starting price was $ 7,500.

Comments (No)

Leave a Reply

+ 54 = 60