Join Our Telegram channel to stay up to date on breaking news coverage
Arcade, a decentralized finance (DeFi) marketplace and lending platform, seeks to expand its capital. The platform has differentiated itself in the DeFi sector because it supports non-fungible tokens (NFTs) financing.
The platform announced that it raised $15 million on a Series A funding round. The funding round was supported by Pantera Capital, Castle Island Ventures, Eniac Ventures, Franklin Templeton Blockchain Fund, Golden Tree Asset Management, etc. Other angel investors include the Chief Executive of BlockFi and Quantstamp.
Arcade secures $15 million
One of Arcade’s cofounder’s Gabe Frank noted that this funding round came at an opportune time, as the DeFi sector was recording major growth. Currently, the total value locked (TVL) for DeFi projects stands at more than $200 billion, and NFTs account for a large portion of the value.
Frank opined that despite the immense NFT growth, the sector lacked the infrastructure needed to achieve growth and liquidity on holdings despite the risking market capitalization.
Lauren Stephanian, the principal at Pantera Capital, commented on this funding round, saying, “We are very excited for the potential of Arcade to bring about the next phase of NFT’s evolution. Arcade’s collateralization of this new asset class will incentivize the participation of new entities from both the traditional and digital art and finance worlds, including institutional lenders, high-net-worth individuals, DAOs, companies with NFTs on their balance sheets, and NFT collectors & creators.”
Growth of NFT collateralized loans
Arcade is one of the first and largest on-chain lending platforms offering loans collateralized by NFTs. The platform made a major milestone after issuing a loan of $800,000 against an NFT portfolio worth over $10 billion.
During Arcade’s private release, the platform has issued total loan volumes of $3.3 million. The total value of assets loaned to this platform equates to $10 million. The Arcade NFT lending platform offers a great utility to the DeFi sector, and it comes with compatibility for all ERC-20 tokens.
Arcade also uses a wrapped NFT (wNFT) technology that allows several NFT assets to be grouped together and generate loans. This allows users to acquire large loans and boost liquidity. Moreover, it also allows developers to build on top of the platform, supporting the growth of these digital assets.
The growth of NFTs has created new use cases for this asset class. Besides Arcade, other platforms have also launched or working towards launching offerings that will support loans against NFTs. These platforms include Drops, a lending platform based in Lithuania and the ETNA network.
In March, Teller Finance, a DeFi lending protocol, announced that it would start offering loans collateralized by special NFTs. This offering would allow users to get credit without using collateral. As the NFT boom continues, such offerings are expected to expand.
Your capital is at risk.
Read more:
Join Our Telegram channel to stay up to date on breaking news coverage
