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How Does a “Peer-to-Peer” NFT Lending Protocol Work?

Lenders offer terms against a borrower's NFT collateral, with the smart contract holding the NFT in escrow until repayment or default.
Greeks.Live16.11.25

How Does a “Peer-to-Peer” NFT Lending Protocol Work?

In a peer-to-peer NFT lending protocol, individual lenders offer loan terms (interest rate, duration, loan-to-value) against a specific NFT offered as collateral by a borrower. The smart contract acts as an escrow, holding the NFT until the loan is repaid.

If the borrower defaults, the smart contract automatically transfers the NFT to the lender, bypassing any centralized intermediary.

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