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Arcade, a platform that allows users to utilize nonfungible tokens (NFTs) as loan collateral, has raised $15 million in a Series A funding round with participation from Pantera Capital.
In a Wednesday announcement, Arcade said Pantera, Castle Island Ventures, Franklin Templeton Blockchain Fund, Golden Tree Asset Management, Eniac Ventures, Protofund, Probably Nothing Capital and Lemniscap in addition to angel investors BlockFi CEO Zac Prince and Quantstamp CEO Richard Ma were behind the investment in an effort to connect NFT-collateralized lending with the decentralized finance space. The platform is also coming out of a private release with $3.3 million in total loan volume secured on a total of $10 million in assets.
Arcade co-founder Gabe Frank said NFTs account for a significant portion of the ever-growing DeFi market, which is currently worth over $250 billion in terms of total value locked. “However, the lack of infrastructure in DeFi prevents NFT holders from achieving liquidity on their holdings despite massive market caps,” he said.
Arcade’s LinkedIn page shows at least 10 U.S.-based employees, with the company currently hiring for various roles, including a senior software engineer, lead talent specialist and team coordinator. Lauren Stephanian, principal at Pantera Capital, said the platform’s collateralization of NFTs had the potential to incentivize participation from “institutional lenders, high-net-worth individuals, DAOs, companies with NFTs on their balance sheets and NFT collectors.”
Related: Nexo partners with Three Arrows Capital to launch NFT lending & art financing service
Other platforms have already launched or are in the process of launching services to facilitate loans against NFTs, including ETNA Network and Lithuania-based lending platform Drops. In March, lending protocol Teller Finance announced that some of its users would be able to obtain credit without posting collateral, accessible through special NFTs.