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What Is the Concept of a “Dutch Auction” in NFT Liquidation?

The NFT's price starts high and automatically drops until a buyer is found, ensuring quick sale and maximizing recovery of the loan.
Greeks.live05.12.25

What Is the Concept of a “Dutch Auction” in NFT Liquidation?

A Dutch Auction is a liquidation method where the starting price of the collateralized NFT is set high and gradually decreases over time until a buyer is found. This method is used for illiquid NFTs to ensure a sale is executed quickly to cover the outstanding loan while attempting to maximize the recovery price, and is entirely automated by the smart contract.

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Glossar

Dutch Auction

Mechanism ⎊ A Dutch auction is a pricing mechanism where the price of an asset starts at a high level and systematically decreases over time until a bidder places an order at the current price.

NFT

Provenance ⎊ Non-Fungible Tokens, within cryptocurrency markets, represent a unique cryptographic token linked to a specific digital or physical asset, establishing verifiable ownership and authenticity.

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