P2P Lending Platform from Blur Originated $100M in Loans in 1 Week

Blur, one of the main competitors of OpenSea, launched Blend, short for Blur Lending, a peer-to-peer lending platform that aims to boost liquidity for the digital assets. The new platform, which was developed with venture capital firm Paradigm, enables users to borrow against their NFTs, with the specific amounts and interest rates decided by individual lenders. This will enable new buyers who were previously priced out of expensive collections like CryptoPunk NFTs to enter.

1/ Introducing Blend: the Peer-to-Peer Perpetual Lending Protocol for NFTs.

Built in collaboration with @danrobinson and @transmissions11 at @paradigm, Blend enables 10x higher yield opportunities than current DeFi protocols and unlocks greater liquidity for NFTs.

Here’s how 👇 pic.twitter.com/uOFC6i3LSq
— Blur (@blur_io) May 1, 2023

Blur explained in a Twitter thread how the product works and explained how the product would help open opportunities for lenders and borrowers seeking to enter the market. The lending features initially support three NFT collections – CryptoPunks, Azuki and Milady – but the Blend protocol allows for any asset to be collateralised.

The most attractive option for collectors is the buy-now-pay-later option, which allows to purchase NFTs without bearing the full cost upfront. Borrowers can either buy the token in full once they can afford to repay the loan, or sell the asset if it appreciates. The platform has zero fees for lenders and borrowers. It has no expiries, allowing borrowing positions to remain open indefinitely until liquidated, with market-determined interest rates.

According to data from Dune, Blend has originated 55,712 ETH worth of loans, as of this writing, or over $100 million worth since its launch on May 1. The most recent addition to Blend is the DeGods collection on May 9, which allows users to acquire the NFT by paying 1 ETH upfront and borrowing 7.6 ETH.

Shortly after the platform went live, the floor prices for some of these collections increased significantly. This led some users to employ a profit generation strategy where they invest in NFT collections most likely to be included on Blend a few days before the announcement.

These collections will also experience an explosion upwards in their floor price.

Our goal: spot these collections before anyone else, know when they will have the Blend feature, invest in them and print a lot.

And this, without needing to have a lot of ETH.

Let's go 👇

4/17 pic.twitter.com/ecX8dyH8Ku
— Nics 👑 (@NFTNics) May 3, 2023

“While it’s good news that NFTs finally have some liquidity, it’s still scary to think that so much ETH is being borrowed against very volatile JPEGS,”wrote crypto trader “@great_ben_” on Twitter.

Blur marketplace has usurped OpenSea as the dominant NFT marketplace in the past few months. The marketplace accounts for over 50% of the trading volume in the industry, according to Dune analytics data. We continue to keep an eye on Blur and its new product.