KEY POINTS
Galaxy Digital CEO Michael Novogratz recently lent funds to Yat Siu, co-founder of Animoca Brands. As collateral for the loan, Siu used a non-fungible token (NFT) representing a rare 300-year-old violin.
While the loan amount remains undisclosed, reports suggest it’s “in the millions.”
“Tokenizing something like a rare Stradivarius violin also helps preserve the legacy of one of the world’s most precious musical instruments and sets an example of how the value of real-world assets can be accessed and utilized through blockchain,” mentioned Siu in a post shared on X (Twitter) earlier today.
A Storied Violin
The violin in question is a prized instrument crafted by Antonio Stradivari in 1708, during his celebrated “Golden Period.”
According to historical records from Tarisio, the violin was acquired for the Russian Empress Elisabeth Petrovna in the mid-18th century.
After her passing, it became part of the collection of Catherine the Great.
Siu himself purchased the violin at auction in 2023 for a sum exceeding $9 million.
NFTs Transforming Borrowing
This transaction exemplifies the growing popularity of NFTs in loan applications, as lenders and borrowers increasingly recognize their value.
Earlier this year, crypto investor GMoney received significant attention for securing a record-breaking $1 million NFT loan through a peer-to-peer lending platform.
A CoinGeko report from April revealed a booming NFT lending market, with the first quarter of 2024 seeing a 43.6% increase in volume compared to the previous quarter, totaling a staggering $2.13 billion. Notably, Blend dominated the market with a 92.91% share.
Just last month, Salvor, an NFT and memecoin lending platform, received a $1 million grant through the Avalanche Rush Program.
Market Downturn
However, this trend coincides with a broader market downturn in the NFT space. May saw a significant drop in NFT sales, with a nearly 50% decrease compared to April.
This decline extends to the major blockchains for NFTs — Bitcoin, Ethereum, and Solana — all of which recorded their lowest monthly sales figures of 2024.
