Long-standing crypto exchange, Kraken, is following in the footsteps of its peers by launching its own NFT marketplace. However, it aims to get a jump on its rivals by offering secured loans using NFTs as collateral.
Kraken plans to have its bespoke NFT hub up and running in the early days of 2022, and will later add the functionality to borrow funds backed by digital assets. As such, the company is building out a feature that will determine the liquidity value of an NFT, thereby calculating the amount of funds they are willing to lend against it.
Due to the high volatility of the current NFT market, Kraken has some calculating to do. It is therefore likely that only certain assets that have been fully vetted will qualify. However, Kraken founder, Jesse Powell, firmly believes that this kind of utility is the next stage of NFT development, stating: “Phase one was speculation, phase two is buying art and supporting artists, phase three is going to be functional uses of NFTs.”
In addition to this innovative evolution of NFT ownership, Kraken also acquired “Staked,” an innovative infrastructure that allows non-custodial staking. This allows investors to earn rewards and yield while maintaining control of their assets. Who knows what was in the Christmas eggnog at the Kraken office, but it is working wonders.
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