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Kraken to Develop NFT Marketplace Offering Token-Backed Loans
The marketplace will determine NFTs’ liquidation value before they are used as collateral.
Updated May 11, 2023, 6:02 p.m. Published Dec 24, 2021, 9:16 a.m.
Crypto exchange Kraken is developing a marketplace for non-fungible tokens (NFTs) where users can arrange loans using the tokens as collateral, the exchange’s founder and CEO Jesse Powell said in a Bloomberg News interview published Friday.
- The marketplace will provide custody, and the exchange is figuring out how to determine the liquidation value of NFTs deposited so that users can use them as collateral for loans, Powell said.
- Kraken follows major exchanges like Coinbase and FTX in developing an NFT market as the assets continue to soar in popularity. OpenSea, one of the most important marketplaces for NFTs, conducted just over $2 billion in trading volume in the past 30 days according to DappRadar data.
- Decentralized finance project NFTfi, founded in February 2020, and crypto lender Nexo already offer NFT-backed loans, but Kraken will probably be the biggest exchange thus far to try it. The exchange is among the top 20 globally by trading volume, data from CoinGecko show.
Read more: NFTs Are More Popular Than Ever Despite Sour Mood in Wider Crypto Market
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