Looking back on 2021, which is called the “first year of NFT”, the concept of NFT has been heated, its utilization rate has increased significantly, and its value has also increased. In the first half of 2021 alone, the market value has reached US $12.725 billion, an increase of nearly 310 times compared with 2018. Behind the doubling of market value is a record of pricy NFT transactions.
As an emerging collection of digital art NFT, while we see its unlimited economic value potential, we also need to see that NFT does not have a convenient and clear realization channel like ordinary art collections or luxuries, and there are many disputes and problems in its value evaluation. The whole collection market of digital art NFT urgently needs a new business form to solve this problem.
In our interview with the person in charge of the relevant business of Hoping Club, he revealed that the profit point of this business mainly comes from lending to customers and resale of retail goods. The virtual digital trading goods owned by customers are mortgaged, and the collateral is valued. Within the value range of this trading goods, a certain interest rate will also be charged by lending funds to customers. The customer will hand over the custody of the loan collateral to the pawnbroker. If the customer fails to repay the loan and interest on time, the pawnbroker has the right to recover the digital art NFT, which means that the digital art NFT no longer belongs to the customer. Pawnbrokers also provide a channel for retail digital art NFT, which can be sold here. In the six months since the business was launched, its total transaction volume has exceeded US $50 million, involving hundreds of NFT works of art in the transaction, including CryptoKitties, CryptoPunks, NBA Top Shot, Meebits and so on.
Looking at the current international form, the Russia-Ukraine War not only has a profound impact on the development trend of the world economy, but also a series of sanctions gradually launched by the United States and the European Union against Russia, especially “to prevent the central bank of Russian from selling a large number of dollar assets in the international market, leading to severe market shocks and even financial crises, and crashing down the economies of western countries”. The sanctions will mean that as long as the central bank freezes assets, it will lead directly to the stabilization of the exchange rate by the central bank of Russia.
In this environment, because digital art NFT trading is completely separated from the business scope of the banking system, it is more convenient for the transfer of assets, and the economic sanctions in Europe and the United States rely heavily on the bank settlement system. Blockchain research company found that a large number of Russians are joining the cryptocurrency market. Some experts also believe that the cryptocurrency market may help Russia escape and deal with the sanctions. Many people with NFT assets are eager to sell the goods in their hands, but suffer from a long waiting period. Another is that they don’t want to sell digital art NFT, but just want to solve their urgent needs by means of pawn or deposit, and need to cash in digital art NFT. However, there is a lack of such a platform in the virtual digital trading market. At this time, Hoping Club launched NFT impawn mortgage business, which filled the market gap at this stage. Its success undoubtedly promoted the vigorous development of the whole NFT market.
