How Do NFT Lending Platforms Verify the Value of the Collateral?
Verifying the value of a unique NFT is complex. Platforms use various methods: price feeds from major marketplaces (floor price), machine learning algorithms that analyze sales history and metadata (rarity), and in some cases, peer-to-peer appraisal.
This valuation is crucial for setting the loan-to-value (LTV) ratio and determining the liquidation threshold.