Blend protocol: Redefining the NFT lending market

Recently, an innovative P2P NFT lending protocol called Blend has attracted widespread attention in the industry. This protocol was jointly launched by a well-known NFT trading platform and an investment institution, aiming to revolutionize the NFT lending sector.

The core features of the Blend protocol include:

• Peer-to-peer perpetual lending model with no fixed maturity date
• No need to rely on oracles
• Lenders can customize the loan amount and annual yield, while borrowers can choose freely.
• When the lender exits, the borrower has a 30-hour window to repay or refinance.
• The borrower can repay at any time.
• Supports the "buy now, pay later" model, which means a down payment plus a loan to purchase NFTs.

This innovative model has significant advantages. By unifying non-essential elements, Blend has greatly reduced system complexity and achieved flexible migration of lending relationships within the system. It employs a market game mechanism to price risks and returns, maximizing user satisfaction.

Compared to traditional P2P models, Blend unifies the term among the three elements of collateral ratio, interest rate, and term into a perpetual flexible model, greatly improving the liquidity issues for lenders. At the same time, this protocol standardizes the exit and liquidation mechanisms for lenders, essentially reflecting the market's acceptance of specific projects.

The Blend platform has fixed the collateral ratio and interest rate on the surface, but due to its flexible exit mechanism, the actual effective terms will basically follow the market average level. This design not only ensures the interests of both lending parties but also maintains the dynamic balance of the market.

For borrowers, Blend offers the advantages of a high collateral rate, low interest rates, and flexible terms. For lenders, it retains the customization advantages of the P2P model while providing liquidity close to that of a funding pool model, and allows lenders to set their own risk control standards for flexible exit.

Blend also integrates the "loan to buy NFT" feature, similar to mortgage loans in the real estate sector. This feature is expected to attract a large number of new users and promote the rapid development of the protocol.

It is worth noting that Blend has not yet empowered its native token significantly. The token has governance rights to set various parameters and the power to enable fee switches after six months, but its future development remains uncertain.

Overall, the Blend protocol has achieved a significant improvement in efficiency by unifying non-essential elements. Its deep integration with the trading module has made a major breakthrough at the product level, bringing new possibilities to the NFT lending market.