Nexo, the crypto borrowing and exchange platform, has launched a nonfungible token (NFT) Lending Desk-bound in partnership with NFT hedge fund Three Arrows Capital letter. The new Lending Desk caters to over-the-counter, or OTC, clients to offer crypto credit backed by NFTs. Nexo is 1 of the commencement crypto lenders to allow customers to borrow stablecoins, Ether (ETH) and other cryptocurrencies using sure NFTs equally collateral.

The company stated that in its initial iteration, the service volition accept Bored Ape Yacht Club and CryptoPunks NFTs, with more collections on the way. Clients tin can also use issued lines of credit every bit a means of art financing by executing further NFT purchases with the borrowed funds.

In a statement shared with Cointelegraph, Nexo co-founder and managing artner Antoni Trenchev said:

"Our partnership with Three Arrows Uppercase is a definitive move towards providing financial instruments & Spider web 3.0-native MetaFi. As we keep to notice the full scope of this asset class, services like Nexo'southward lending will exist in high demand to unlock NFTs' underlying value while allowing users to retain buying."

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By collaborating with Three Arrows Capital, Nexo said it hopes to expand its existing crypto credit issuance services by providing the NFT Lending Desk with risk hedging, valuation and liquidation mechanisms. Additionally, Three Arrows Uppercase became the first NFT Lending Desk-bound client with an NFT-collateralized crypto credit issued past Nexo.

Three Arrows Upper-case letter manager Kyle Davies added that they are "happy to partner with Nexo and demonstrate our recognition of NFTs' promise as a fiscal instrument — one that requires appropriate, loftier-quality financial tools to be fully leveraged."

Related: Iii Arrows buys 156K ETH in the weeks after CEO 'abandoned ETH'

In the coming months, Nexo said it plans to increase its offerings of investment-form products and attainable and secure exposure to the NFT market, according to the visitor.

As the NFT-backed lending market grows and NFT utility increases, other lending platforms such as NFTfi, ETNA Network and Drops Loans are too offering services like to Nexo's.