Last Updated on May 26, 2023 by Bitfinsider
The Binance exchange is introducing a loan option using non-fungible tokens (NFTs) so that owners of digital assets can borrow Ether (ETH) using their NFTs as security.
The new service, called Binance NFT Loan, “will allow people to use blue-chip NFTs to borrow crypto, starting with ETH, introducing the benefits of DeFi to the Binance NFT community,” the company said in a news release.
The platform advertises the instrument as having advantageous terms such as low interest rates, fast funding, no gas expenses, and safety from the risk of running out of money. Rather than having a single entity guarantee loans, Binance facilitates a “Peer-to-Pool” system.
As of its launch this coming Friday, the function will only be able to process Ethereum loans and the Non-Fungible Token (NFT) collections Bored Ape Yacht Club (BAYC), Mutant Ape Yacht Club (MAYC), Azuki, and Doodles. In the near future, more features will become available on the platform.
According to Binance’s head of product Mayur Kamat, the addition will give holders more liquidity choices, “allowing them to participate in the market without having to let go of their precious NFTs.”
“We’ve added a host of features that make it a one-stop shop for NFT trading and financial services for our community,” Kamat explained.
In order to maintain its position as the industry leader, Binance has recently been increasing the variety of NFTs it offers. The platform debuted its beta version of “Bicasso,” an AI-driven NFT generator, in March. And it said back in May that it would be adding Bitcoin NFT functionality very soon.
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