Binance Marketplace, the non-fungible token (NFT) trading platform of cryptocurrency exchange Binance, is introducing a new service on Friday that allows users to borrow Ether using NFTs as security. It will go off against Blend, the trading protocol used by Blur, the top NFT trading platform in the globe, which has monopolized 82% of the NFT loans market since its May 2 launch.
Binance NFT Loan Service
“Users can take advantage of greater flexibility on their NFT assets while maintaining the potential long-term value of their NFTs without having to sell them,” Binance stated in its launch of the Binance NFT Loan service.
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The service will initially only support loans made with Ethereum. Additionally, only NFT collateral options from the Bored Ape Yacht Club (BAYC), Mutant Ape Yacht Club (MAYC), Azuki, and Doodles collections will be supported.
According to Binance, the company plans to increase its offering of those services in the future. Binance will compete against Blur, the largest NFT trading platform in the world, for the position of best NFT loan service.
On May 2, Blur launched Blend, its own peer-to-peer lending protocol for NFTs. 82% of the whole NFT loan market is dominated by Blend. DappRadar, a blockchain data aggregator, reports that in the first 22 days after opening, it recorded a loan volume of over US$308 million.
According to Brendan Humphries, head of business at peer-to-peer NFT lending platform Pine Protocol, the ongoing nature of Blend’s loans has proven attractive to traders looking for more leverage.
“Products like Blend contribute to the NFT market’s continued maturation, improve market effectiveness, and increase the space’s allure for new entrants seeking sophisticated products and tools,” Humphries stated.
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