Blur NFT lending protocol gets mixed reactions from the community

Jesse Hynes, a Web3 lawyer, tagged the SEC and stated that this is the type of activity that they must safeguard investors from.

Nonfungible token (NFT) marketplace Blur has recently launched its collateralized lending protocol called Blend, allowing a buy now, pay later approach in purchasing NFTs. 

Members of the community had varying reactions. Some believe that it’s massive for the space while others called on the United States Securities and Exchange Commission (SEC) to protect users against such products.

On May 1, Blur launched a peer-to-peer perpetual lending protocol called Blend, a platform they developed with the help of the venture capital firm Paradigm. The protocol supports NFT collateral, and the team claims that it would collect zero fees from both lenders and borrowers.

A community member praised Blur’s new move and believes that it’s “massive for the space” and makes things more efficient. They tweeted:

Massive for the space – great move by @blur_io. Effectively this allows you to loan out your ETH for yield, and also allows better cash/jpeg efficiency. https://t.co/PikWKqN0Jn

— peepeedog.eth (@peepeedog) May 2, 2023

Meanwhile, another Twitter user thinks that the new development from the OpenSea competitor is a good distraction from the “overall negative sentiment” within the NFT space. The community member may be referring to the dwindling number of NFT buyers in April. According to data from the analytics platform NFTGo, sellers dominated the NFT market in the month. 

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While some were focused on the positives, others expressed their disapproval of NFT lending. A community member highlighted the risk of not being able to pay the loan and losing much more money in the process. Meanwhile, an NFT collector took the opportunity to give a lesson on NFTs.

1st rule for #NFTs : only invest money you can afford to lose. If you need a loan, you’re overexposed! So just don’t do it and don’t let blur tell you something else! In this space there are kids playing with money. Giving them a loan and take their poket money is just criminal https://t.co/N3IqSWLTbL

— Taki_Nooby_Booby (@Taki_NoobyBooby) May 1, 2023

Web3 lawyer Jesse Hynes tagged the SEC’s Twitter account and said that this was the type of activity that the commission should be protecting investors from. According to Hynes, it’s “extremely dangerous.” 

Blur has been constantly positioning itself within the NFT space, prompting moves from OpenSea in what the community informally refers to as the “NFT marketplace wars.” On Feb. 18, OpenSea implemented 0% fees to win back its users from Blur. OpenSea has also recently launched an advanced NFT marketplace aggregator in another effort to rock the boat.

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