Convex's Curve PUSd LPs
Before we get started, this is not a recommendation or endorsement to buy any token mentioned.
One of the most desirable use cases in DeFi yet to be fully realized is borrowing instant liquidity against NFTs. Many teams raised money during the bull run promising to build the world’s best NFT lending platform, including borrowing against the aggregate value of a basket of NFTs, but as time has passed, it seems likely a lot was overpromised while the earliest innovators in NFT lending continuing to build and gain market share. One example in particular is NFTfi.
Launched in 2019, NFTfi is a decentralized p2p marketplace for over-collateralized loans in WETH or DAI, backed by NFTs. It requires a borrower to match with an individual lender, while only putting up one NFT at a time, but as of today, it’s the leading NFT-backed loan issuer with 67,301 ETH + 43,144,234 DAI in total loan volume.
What’s promising is we’re still in the early development of instant p2pool borrowing against NFTs (ie DeFrag) and others platforms for borrowing against a basket of NFTs (ie PWN, Arcade) vs a single high-value NFT like NFTfi. Btws, NFTfi confirmed they will also look to support borrowing against baskets of NFTs, pending a future EIP enabling nesting NFTs on Ethereum.
More recently, JPEG'd launched as a decentralized lending protocol on Ethereum that enables NFT holders to open collateralized debt positions (CDPs) using their NFTs as collateral. Here’s how it works:
- Users mint PUSd, the native stablecoin of JPEG’d, enabling them to effectively obtain leverage on their NFTs, based on the floor price of the NFT