Nexo Launches NFT-Backed Lending Service
Nexo is the first crypto lender to introduce a credit service backed by NFTs.
- Nexo has unveiled an "NFT Lending Desk" in partnership with Three Arrows Capital.
- Nexo’s NFT Lending Desk accepts top NFTs as collateral, including Bored Apes and CryptoPunks.
- Three Arrows Capital will be providing expertise on hedging, valuation, and liquidation for the service.
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Nexo has launched a lending product that uses CryptoPunks and Bored Apes as the underlying collateral.
Crypto Lender Will Accept High-Value NFTs
Nexo has become the first regulated crypto lending platform to offer an NFT lending facility. The firm unveiled a new service called “NFT Lending Desk” in partnership with venture capital firm Three Arrows Capital.
With the launch, Nexo will allow its OTC clients to take loans by putting their non-fungible tokens up as collateral. Nexo’s NFT Lending Desk currently accepts top NFT collections–Bored Ape Yacht Club and CryptoPunks, with more to be added in the future.
In a press release, Nexo said clients can borrow stablecoins, ETH, and other crypto assets using the supported NFTs. As a centralized crypto lending platform, Nexo claims to have processed more than $50 billion from millions of users globally.
Nexo co-founder and managing partner Antoni Trenchev said its partnership with Three Arrows Capital on its NFT lending service “is a definitive move towards providing financial instruments & Web 3.0-native MetaFi.” Speaking further about the NFT-backed lending, Trenchev added:
“As we continue to discover the full scope of this asset class, services like Nexo’s lending will be in high demand to unlock NFTs’ underlying value while allowing users to retain ownership.”
Meanwhile, Three Arrows Capital will provide its expertise on hedging, valuation, and creating liquidation mechanisms for the NFT Lending Desk. Commenting on the Nexo partnership, Three Arrows director Kyle Davies said:
“We are happy to partner with Nexo and demonstrate our recognition of NFTs’ promise as a financial instrument–one that requires appropriate, high-quality financial tools to be fully leveraged.”
The launch comes at a time in which the NFT market has exploded after garnering media attention and celebrity interest. The hype around blockchain-based virtual lands, also called “metaverse” has further revved the NFT niche.
Disclosure: At the time of writing, the author of this piece owned ETH and other cryptocurrencies.