Wealthy NFT Owners Are Taking Out Loans Backed by Bored Apes, CryptoPunks

“That’s our niche, that high-end, long tail market,” the head of an NFT lending marketplace told Blockworks

article-image

Blockworks exclusive art by Axel Rangel

share
  • Arcade, an NFT lending platform, has more than $20 million of NFTs in escrow
  • Nexo, a cryptocurrency lender, introduced its NFT-backed lending desk last year

Wealthy individuals, long accustomed to taking out loans against Picassos and van Goghs, are now tapping Bored Apes and CryptoPunks as stores of cash.

In the latest sign that digital art and collectibles are coming into the financial mainstream, one NFT collector put up two rare Zombie CryptoPunks this week as collateral for a $3-million loan facilitated by peer-to-peer lender Arcade.

The NFT (non-fungible token) platform specializes in matching blockchain art owners with would-be lenders. Arcade has more than $20 million of NFTs in escrow, according to CEO Gabe Frank.

Arcade’s financing terms, Frank said, are comparable to fine art lending — a market where hedge funds and other asset managers underwrite loans on the behalf of art-collecting high-net worth individuals. Bank of America, for instance, has more than $10 billion of such loans.

“It looks very similar to that model in that high-net-worth collectors want to use their locked up capital more efficiently,” Frank said. “[For them], it comes down to capital efficiency, being able to leverage [their] assets and either buy more NFTs or invest elsewhere to earn a higher rate than an interest rate on a loan.”

The model tosses credit checks and reserve assets out the window, considering both borrower and lender settle the loan trustlessly, employing self-custody and keeping the transaction on-chain.

Arcade’s loans typically last three months and charge 20% interest annually — less than credit cards, but still steeper than other bank loans. The fees vary, in part depending on an NFT’s liquidity.

“That’s kind of our niche, that high-end, longtail market,’ Frank said. “We provide this (over-the-counter) type of service for high-net-worth collectors that want to collateralize their assets. It looks similar to something that Sotheby’s does.” 

Noah Gaynor, CEO of NFT marketplace Parcel, told Blockworks it’s another sign that “various protocols and primitives [are] bridging DeFi and NFTs.”

Added Gaynor: ”NFTs should be treated the same as any other asset, which includes using them as collateral.”

Arcade supports exclusively ether-based NFTs, with acceptable collateral ranging from plots of virtual land to blue-chip collections such as Bored Ape Yacht Club and CryptoPunks.

“We think that [around] 95% of the NFTs are probably not worth anything,” Frank said. “But it’s the top 5% like the CryptoPunks and the Apes that have billions in market cap that do have a lot of staying power.”

Other crypto companies are following suit in the NFT lending game.

Crypto lender Nexo started its first NFT lending desk in December, likewise accepting Bored Apes and CryptoPunks for collateral.

“An NFT can be anything and can provide so many functions,” Antoni Trenchev, co-founder of Nexo, told Blockworks. “[In the future,] we’ll be providing loans and financing people’s purchase against anything from digital real estate, to gaming items, or even limited edition Nike sneakers.”


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 24 - 26, 2026

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Unlocked by Template.png

Research

Institutional staking providers specialize in offering secure, compliant, and scalable solutions for organizations, asset managers, and individuals who wish to stake large volumes of digital assets. Staking-as-a-Service Providers (SaaSPs) act as intermediaries, running blockchain nodes and managing the technical complexities of staking on behalf of clients, often providing custody, reporting, and yield optimization features across a broad range of assets and networks.

article-image

The undercollateralized lending system plans global growth after surpassing 175,000 loans in less than a year

by Blockworks /
article-image

Share indexes every transaction across Solana, Base and Ethereum

article-image

The plan is to scale PayPal USD with Spark’s liquidity framework, building sustainable stablecoin markets

by Blockworks /
article-image

The company introduced a dollar-backed stablecoin to power instant payments and microtransactions for AI-driven web platforms

by Blockworks /
article-image

The plan is to make GameShift the “consumer portal” that bridges non-crypto gamers into Web3

article-image

Google backs $1.4B of obligations and takes 5.4% stake as Cipher expands AI data center footprint

by Blockworks /