Suddenly, a $400 image can be an investment that gains value over time, rather than an expenditure that hangs on the wall until it’s damaged or sold in a yard sale. This reduces the cost and increases the reliability of asset-backed loans, thereby making them worthwhile on less expensive assets. The NFTs are held in escrow in blockchain-based code that only releases upon repayment or for liquidation if prices drop. More liquidity makes valuation data more reliable, which in turn enables financiers to lend against lower-value goods at higher loan-to-value ratios.Īsset-backed DeFi lenders like Gondi and NFTfi offer such loans, collateralized by NFTs. With faster sales and lower costs, buying and selling is not just easier, it happens more often and more quickly, which means greater liquidity. Remember those annoying transaction costs mentioned above?Ĭompare Opensea’s 2.5% commission and two-to-three-day auctions to Sotheby’s 20%+ commissions and fees and months-long sales and auction process. Yet with NFTs, the transformational element is not just the medium itself, but the way collectors are leveraging new tech, specifically the exchanges and DeFi lending services, to make faster, more affordable deals.ĭecentralized NFT exchanges like Opensea and Blur BLUR offer instant settlement without requiring an intermediary to take custody of either the NFTs or the cryptocurrency, cutting costs and friction. The majority of attention swirls around the priciest NFTs, like Pak’s Merge, which went for nearly $92 million in late 2021. ![]() ![]() ![]() Think of the NFT as representing exclusive rights to the image, as one might own a photographic print, like this $4.3M Gursky photograph.Īt first glance, this emerging medium seems to echo the traditional art market. Enter NFTs, which are digital records on the blockchain that prove ownership over something unique, typically a digital image.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |