OT: Sub-Primate Lending

We’ve had a couple interesting threads on NFTs lately, so I thought this would fit it. Apparently, through the miracle of blockchain you can get a loan against your hyperlink to a crappy .jpg. This is done by way of a decentralized autonomous organization (DAO) using smart contracts on the blockchain. However, as the value of the NFTs has dropped, millions of dollars of NFT loans are in danger of getting called. This could cause a cascading effect. As the NFTs are liquidated it likely would cause the floor price to drop, trigging more called loans.

When people started sinking hundreds of thousands of dollars into Bored Ape NFTs, it wasn’t long before people came up with the genius idea of using those NFTs as collateral for loans. BendDAO is one such platform offering the service, allowing people to post their Ape as collateral in exchange for a crypto loan equal to 30–40% of the Bored Apes collection’s floor price. At one point, one borrower had 10,000 ETH (~$17.5 million) in loans from BendDAO against his 60-ape-strong collection (though he since repaid the loans).

However, NFTs in general haven’t been doing so hot lately, and the Bored Apes haven’t been immune from the slump. As the Bored Apes collection floor price has decreased, more than 15% of the apes used as collateral for BendDAO loans are in the “danger zone”—close to being auctioned off. These 45 apes are valued at roughly $5.3 million. Liquidation could lead to cascading liquidations, as the auctions could themselves cause the floor price to decrease.



Messing around with what you use as money or “sound investment” seems to me more than simply risky, it seems so inherently weird as to be a type of eccentric neurosis.

david fb

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Excellent find.

Another one for you.

Sudoswap. They offer fast swaps of NFTs. They offer “liquidity” for the market. Lets face it straight up most of the art in this market is totally worthless…as usual. The other thing they do is automate the stripping of royalties from the original artist. I think that will get them sued for theft. The royalty rate is fully expressed as part of the deal. Just by passing someone else’s deal and selling something is like stealing something off a merchant’s shelf to sell out on the street without the merchant.

The number of dumb plans is unparalleled. To make it worse the number of investors is still crazy.


Thinking the same thing. Many people have a hard time understanding the value of the Eth. Meaning not only is it volatile but it has a value in USD that is being ignored.

Some people understand business practices and are not abusing clients, customers and vendors. Their reputation is doing better and the money is in those businesses, coinbase and opensea…there are others very unsung.

I give you a rec just for a brilliant thread title.