2024-04-26
The NFT lending market has experienced significant growth, with leaders solidifying their positions.
According to data from CoinGecko, the total NFT lending volume reached a quarterly high of $2.13 billion in Q1, showing a 43.6% quarter-over-quarter growth.
In January, there was a record-breaking $0.90 billion in total monthly NFT lending volume, surpassing the previous peak of $0.85 billion in June 2023.
Among the top performers, Blend emerged as the leader, capturing a remarkable 92.9% share of the market with a monthly lending volume of $562.33 million in March alone.
While Ethereum NFT collections dominate NFT loan originations, the potential impact of the rising popularity of Bitcoin Ordinals on the NFT lending market remains an area of interest.
Arcade and NFTfi, among others, have also witnessed growth in the NFT lending arena. However, they hold significantly lower market shares, capturing 2.8% ($16.94 million in volume) and 2.2% ($13.3 million in volume) respectively.
Further down the hierarchy, X2Y2, BendDAO, and Parallel Finance (formerly ParaX) hold smaller market shares of 0.8%, 0.8%, and 0.5%, respectively.
To encourage user engagement, NFT lending platforms are introducing new incentives to boost trading volumes. For example, Arcade, backed by Pantera Capital, unveiled its "Clash of Clans" airdrop initiative in late February.
This initiative aims to distribute ARCD tokens among 4,000 eligible wallets, with each wallet able to claim 750 ARCD tokens.
Similarly, marketplaces like X2Y2 and BendDAO have launched their own tokens for community members.
