![Entering the NFT Market? Blur's Blend Offers a Solution Entering the NFT Market? Blur's Blend Offers a Solution](/media/cache/72/ba/72ba750cf11947380ada42ef2d37d350.webp)
Entering the NFT Market? Blur's Blend Offers a Solution
Blur, a nonfungible tokens (NFTs) marketplace, has introduced Blend, a peer-to-peer perpetual lending protocol that supports NFT collateral. The new product was developed with venture capital firm Paradigm and aims to bring financialization to scale.
Blur, a nonfungible tokens (NFTs) marketplace, has introduced Blend, a peer-to-peer perpetual lending protocol that supports NFT collateral. The new product was developed with venture capital firm Paradigm and aims to bring financialization to scale.
Blend enables users to maximize the liquidation of their NFTs by allowing buyers to put collateral against their token purchases. This means that first-time buyers who are entering the ecosystem can avoid spending on expensive collections. The new protocol is the solution for people wanting to buy into a collection but cannot afford the price.
According to Blur, Blend allows collectors to apply the same principles of home buying to NFT markets. This means that collectors can put up a percentage of the full NFT price and finance the remaining balance, just like a down payment on a property. In a Twitter thread, Blur shared the details of the product, explaining how Blend will help open opportunities for lenders and borrowers seeking to enter the market.
Developers have designed Blend to have neither oracle dependencies nor expiries, allowing borrowing positions to open indefinitely until terminated. They also claim that the protocol would collect zero fees from borrowers and lenders.
By using a perpetual lending protocol, borrowers and lenders extend the loan expiration time by a predetermined period by default. If a lender wishes to terminate the loan against the borrower's wishes, an interest-rate "Dutch auction" for refinancing is held when the borrower has not repaid the debt at expiration. The auction begins at 0% refinance interest with a steadily rising rate.
Blend automatically "rolls a borrowing position for as long as some lender is willing to lend that amount against the collateral." No on-chain transactions are required unless one party decides to exit the position or there is a change in interest rate. Borrowers can repay the loan at any time on Blend.
Developers explained that "if a borrower wants to change the amount they have borrowed or get a better interest rate, they can atomically take out a new loan against the collateral and use the new principal to repay the old loan."