The NFT-backed loan market is gaining steam, with total loan value to date recently topping $1 billion across various protocols—and now the current largest Ethereum NFT marketplace by trading volume is getting in on the action, too.

Today, NFT marketplace Blur announced the creation of Blend, a peer-to-peer perpetual lending protocol based around NFT assets. Short for “Blur Lending,” Blend lets NFT collectors take loans out on their existing assets, and also lets liquidity providers earn interest by loaning out ETH with the NFT serving as collateral.

Unlike some lending protocols, Blend does not have set timeframes for loans to be repaid. Instead, they’re perpetual, which means that they continue to accrue interest until repaid, or until the lender triggers a refinancing auction. This allows another lender to take over the loan, if desired, otherwise a liquidation auction can be triggered for the NFT collateral.

Furthermore, the loans do not rely on oracles, or external, off-chain data sources. That means that a loan on Blend will not look at NFT pricing data across marketplaces, which is used by some lending protocols (like BendDAO) to determine liquidation criteria.

(By Andrew Hayward)