Nexo Grants $3.3M NFT Loan to CryptoPunk Owner‍

Nexo, a cryptocurrency lending platform, recently accepted a loan of 1,200 ETH secured by two CryptoPunks NFTs. Many observers believe this is one of the largest NFT-backed loans to date, at around $3.3 million.

Multiple parties were involved in the deal, including Arcade, a decentralized finance (DeFi) marketplace and NFT lending platform, and Meta4Capital, an investment manager.

Due to their high rarity ranking, Nexo may have felt more comfortable retaining these NFTs as collateral. Both CryptoPunks used in this loan belong to the exclusive zombie category. There are only 88 zombie CryptoPunks in the iconic 10k NFT collection. 

‍“With this multi-lateral partnership, we are demonstrating the merge between traditional, decentralized, and crypto finance,” said Kiril Nikolov, the chief of DeFi strategy at Nexo. 

CryptoPunks #2306 and #2484 were among the NFTs utilized in this transaction, according to a Business2Community report. Nobody knows who donated these NFTs to Nexo for this 60-day loan, but sources indicate that they will pay a 21 percent yearly interest rate.

Nexo's NFT Lending Desk currently accepts only two NFT projects: CryptoPunks and the Bored Ape Yacht Club. However, the platform says it aims to onboard more blue-chip NFT collections as it expands this new service.

Nexo secures clients' NFTs using the Arcade.xyz platform. According to recent sources, Arcade.xyz holds around $15 million in NFTs for consumers who have taken out NFT-backed loans.