In late 2021 and early 2022, many people heard the ‘Non-Fungible Token’ term for the first time. In these times, the market witnessed a huge bull run on NFTs.
In January 2022 alone, NFT marketplaces reached more than $17 billion in volume in a single month. Since then, secondary market sales dropped significantly. In the last month, November 2022, the volume was $414 million.
For many people, NFTs are born with hype. No doubt, the hype may help, yet the technology makes it inevitable.
NFTs are not just for buying and selling. They can represent your Web3 identity, give you unparalleled utilities on a platform, become tickets to a concert, or become the land register of your house. Possibilities are limitless. The most important thing is when you own an NFT, you truly own it. You should have proper financing solutions when you own an asset.
It is why even though NFT marketplaces volumes drop, NFT-backed Lending solutions stay strong. To see that, we may check last year’s statistics and compare them with NFT marketplaces.
NFT-Backed Lending and NFT Marketplaces Volume Comparison
While the total volume realized in January 2022 NFT Marketplaces was $5,17 billion, this value decreased to $414 million on November 2022. 92% volume drop from peak to last month.
While the total borrowing volume on January 2022 NFT-Backed Lending platforms was $11 million, this value increased to $18 million on November 2022. Even though NFT-Backed Lending peaked at $125 million on April 2022, the drop is 85% from the peak to last month and holding better than NFT marketplaces.
Also, the NFT-Backed Lending platforms only have 4090 unique users, while NFT marketplaces have 230,000.
Low user numbers of NFT-Backed Lending are the result of limited market coverage. It is why we are developing Piggylet and aiming to democratize DeFi solutions on NFTs.
As Piggylet Team, we believe that with a true coverage of DeFi solutions on the NFT market, NFT-Backed Lending volume may directly rival NFT marketplaces. We build Piggylet platform in this direction in our minds and hearts.
To learn more about our vision and mission, check: Piggylet’s Mission, Vision, and Role of The Network Effect | by Piggylet | Oct, 2022 | Medium
It is not only us that are aware of the potential of DeFi solutions on NFTs.
X2Y2, an NFT marketplace, has also developed its NFT-Backed lending solutions.
X2Y2 NFT-Backed Lending and X2Y2 NFT Marketplace Volume Comparison
According to X2Y2’s weekly graphics on both products, NFT-Backed Lending increases its volume rapidly. Even X2Y2 brings this solution to limited NFT projects like other platforms.
DeFi solutions on NFTs are important tools for NFT investors, collectors, enthusiasts, and DeFi investors. As Piggylet, our mission is to explain to NFT communities and DeFi investors what NFT-backed DeFi brings and expand the market.
Thanks for being here to read about the next era of NFT-backed financial instruments. Follow us on Twitter and Medium. You may also subscribe with your email on Piggylet.com to never miss news and updates on our products and projects. Always hodl and buidl, see you soon lads’n’lasses!
Website: https://piggylet.com
Twitter: https://twitter.com/piggyletdefi