Participated · Series A · Mar 2024

NFTfi operates a simple NFT-collateralized loan marketplace where users can use their NFT assets as collateral to take out loans or lend to other users. The platform matches borrowers and lenders and accepts NFTs as pledgeable collateral. Its product focuses on unlocking liquidity from NFT holdings by enabling secured lending against digital collectibles. The company announced completion of a $6 million A1 financing round. That round was led by Placeholder, with participation from Maven 11, Launch Labs Inc, Kahuna Ventures and others. The funding represents the company’s latest external financing disclosed in the article. NFTfi operates a decentralized, peer-to-peer marketplace where borrowers post NFTs as collateral and lenders bid to provide cryptocurrency loans; NFTs are held in smart contracts during the loan period. Borrowers receive funds while lenders set interest rates and terms; when loans are repaid the NFT returns to the borrower, and if not repaid the lender takes the NFT. NFTfi takes a 5% cut of the interest earned by lenders and does not make money on defaults. Since its first loan in May 2020 the platform has facilitated more than 1,500 loans, transacting over $26.5 million in value, with lenders earning more than $500,000 in interest and roughly 20% of loans defaulting. Founded by Stephen Young in February 2020, the team is mostly based in South Africa while the company is incorporated in the British Virgin Islands for compliance. With the new funding NFTfi plans to grow its team, launch new product features, roll out to other blockchains, invest in its community and fund its decentralization efforts. NFTfi operates an Ethereum-based marketplace that lets NFT owners mortgage their tokens to receive loans in ether or the DAI stablecoin. The platform functions like a pawn shop for NFTs: borrowers transfer an NFT into escrow and a smart contract enforces loan terms set by lenders. Typical loan-to-value is around 50%, with annualized interest rates commonly between 20% and 80% and occasional loans as high as 100–150% APY for riskier deals. NFTfi has facilitated over $12 million in volume since launching in June 2020; the platform reported an average loan size of about $26,000 for the month and has handled loans up to $200,000. Default rates vary by asset but currently hover just below 20%. Users range from retail collectors and students to DeFi traders and yield farmers who use borrowed funds for fiat conversion, margin, or further DeFi activity.