Binance Strengthens DeFi Space With Innovative NFT Lending Service Feature – Cryptopolitan
Binance, the leading global cryptocurrency exchange and blockchain platform, is introducing a new service to its marketplace – the Binance NFT loan. This new feature, which goes live on Friday, is a great development that allows digital asset holders to leverage their Non-Fungible Tokens (NFT) as collateral to secure Ethereum (ETH) loans.
In a press release, Binance highlighted that this innovation aims to bring the benefits of Decentralized Finance (DeFi) to the NFT community. The loan tool provides immediate liquidity, competitive interest rates, zero gas fees and liquidity protection. It uses a “Peer-to-Pool” methodology where Binance acts as the lending pool. Initially, the service will only support Ethereum loans and NFTs from reputable collections such as Bored Ape Yacht Club (BAYC), Mutant Ape Yacht Club (MAYC), Azuki and Doodles. However, Binance envisions expanding its offerings in the future.
Binance Chief Product Officer Mayur Kamat highlighted the new feature as an invaluable addition, allowing asset holders to participate in the market while retaining their coveted NFTs. Kamat emphasized, “We have added a number of features that make it a one-stop shop for NFT trading and financial services for our community.”
Consolidating its position in the crypto landscape
With the current interest rate on NFT loans pegged at 7.91% pa and the loan-to-value ratio fluctuating between 40% and 60%, Binance aims to redefine the DeFi landscape. Also, the service ensures no Ethereum transaction fees or gas fees, which adds to its appeal.
Since the launch of the NFT marketplace in June 2021, Binance has committed to improving its NFT offerings. The platform recently announced its upcoming support for Bitcoin NFTs and the launch of a beta for “Bicasso”, an artificial intelligence (AI) powered NFT generator. These advances mark Binance’s efforts to stay ahead of the rapidly evolving crypto space.
The arrival of the Binance NFT lending feature follows the introduction of the NFT lending protocol, Blend, by NFT market giant Blur. Blend has also experienced significant growth, and analysts attribute its success to its market-driven approach. As Brad Kay of The Block Research reports, “Blend’s meteoric rise in the NFT lending market is undeniable. As it continues to break new ground, the protocol proves that a market-driven approach can successfully revolutionize the lending landscape.”
As Binance enters the NFT lending space, it reinforces its commitment to foster innovation in crypto, further cementing its position as a leading player in the global crypto landscape.
