Binance Enables Lending Secured by Non-Fungible Tokens

Binance’s NFT marketplace has integrated a feature enabling lending of cryptocurrencies against non-fungible tokens.

Currently, collateral available includes digital assets from the Bored Ape Yacht Club, Mutant Ape Yacht Club, Azuki, and Doodles collections.

For now, NFT collateral can be borrowed only in Ethereum. Binance plans to expand the list of available collections and cryptocurrencies in the future.

The current lending rate stands at 3.39% per year. The loan-to-value ratio ranges from 40% to 60%. Gas fees in Ethereum will not be charged.

“Loans will add a new form of liquidity for NFT holders, enabling them to participate in the market without having to sell their precious tokens,” said Mayur Kamat, Binance Product Manager, in a comment to The Block.

In May, Binance announced the integration Bitcoin Ordinals with its marketplace in late May. According to the company’s statement, the Bitcoin-based solution “offers unique and innovative opportunities for creating non-fungible tokens.”