Kraken plans to offer loans backed by NFTs in 2022

Kraken plans to offer loans backed by NFTs in 2022

Kraken is about to enter the NFT space in a big way.  The company’s CEO and founder Jesse Powell told Bloomberg News this week that the global digital asset platform will not only be launching an NFT marketplace in the new year, but users will be able to use their NFTs as collateral to take out loans.

Powell said, “If you deposit a CryptoPunk on Kraken, we want to be able to reflect the value of that in your account. And if you want to borrow funds against that.”

The Kraken CEO also suspects that NFTs are in their infancy and the speculative asset class will demonstrate its utility in 2022.

“Phase one was speculation, phase two is buying art and supporting artists, phase three is going to be functional uses of NFTs,” noted Powell.

It is not yet known exactly when Kraken will open its NFT market and allow nonfungible tokens to be used as collateral.  Nonetheless, the company is currently developing a system to assess the liquidation value of NFTs deposited on its platform for this purpose.

Kraken is among the world’s biggest digital asset platforms by liquidity, trading volume, and reserves held.  Kraken users have access to more than 90 digital assets plus USD, CAD, GBP, EUR, JPY, AUD, and CHF.

Kraken made news earlier this month when it acquired Staked, a popular cryptocurrency staking platform, for an undisclosed amount.  The deal was the company’s fifth big acquisition of the year.

More information about Kraken can be found at kraken.com.

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