Crypto lender Nexo is teaming up with Three Arrows Capital to launch a new crypto credit service backed by valuable non-fungible token () items.
As is the case with Nexo’s existing products, clients will be able to use NFTs as collateral to borrow, , and other digital currencies.
Nexo’s NFT Lending Desk will begin accepting Bored Ape Yacht Club and CryptoPunks NFT collections, with more collections to be announced in the upcoming weeks.
Bored Apes and CryptoPunks are among the most popular and expensive NFT collections in the market, with the price tag on some of the items reaching hundreds of thousands of dollars.
A non-fungible token is "a unique digital certificate, registered in a blockchain, that is used to record ownership of an asset such as an artwork or a collectible," according to The Collins English Dictionary.
The term NFT was also Collins’ word of the year for 2021.
Unlocking NFT’s underlying value
Describing the new initiative as “a definitive move towards providing financial instruments and Web 3.0-native MetaFi,” Nexo co-founder Antoni Trenchev also said that “NFTs' potential reaches far beyond art, encompassing ownership, exclusive access, functions, and features.”
“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,” said Trenchev in an announcement shared with Decrypt.
Nexo also revealed that in the coming months it plans to launch more investment-grade products with high-profit exposure to the NFT market.