NFT-Backed Loans & Bored Ape Burgers 🍔
Using NFTs as collateral, and a new Bored Ape-themed restaurant
Cultured is a newsletter that gets readers up to speed on the most interesting things going on at the intersection of finance, art, collectibles, NFTs, and more. Cultured is produced by Otis, an alternative investment platform that was recently acquired by Public.com.
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🗞 STORIES OF THE DAY
The new world of NFT-backed loans
With the value of major NFT projects starting to stabilize, some lenders are letting buyers back their loans with their digital collectibles. Marketplaces like NFTfi are hoping that they can help collectors find liquidity in these items.
The framework is simple: collectors put up their NFTs as collateral using a lending protocol like MetaStreet. The loans are targeted at collectors who need cash for short-term transactions. NFTfi, for example, offers a 10% APR for a 90-day loan.
The collector who made headlines for pulling a lot of 104 CryptoPunks from a Sotheby’s auction used the NFTs to land an $8 million loan. He took that approach because it allowed him to keep his “CryptoPunk exposure while simultaneously unlocking liquidity.”
Our Take: NFT-backed loans have the potential to revolutionize collecting.
These loans mark another step toward NFTs becoming a full-fledged asset class. While wealthy collectors have long used their collections as collateral for loans, the growth of NFT loan marketplaces suggest that smaller collectors will now be able to benefit from this same approach. Perhaps in the future, we’ll see similar loans being offered for physical collectibles like trading cards or sneakers.
A BAYC restaurant is opening in California
A restaurateur in Long Beach, CA has opened the first Bored Ape-themed restaurant. Bored & Hungry serves burgers and fries and will only accept ETH and $APE, BAYC’s token.
Andy Nguyen, the restaurant’s owner, shelled out $267,000 for an Ape a few months ago. That purchase gave Nguyen the commercial rights to the Ape’s intellectual property, which he then used to launch the restaurant.
Bored & Hungry will also take advantage of Token Gating, which offers additional perks to holders of a certain NFT. The restaurant will offer free combos and other perks to customers who have $APE tokens, or Bored Apes/Bored Ape spinoffs.
Our Take: This is the first big IRL test of Bored Ape Yacht Club’s unique approach to intellectual property.
One of the things that has set BAYC apart from other NFT projects (and made it incredibly popular) is that Yuga Labs offers full IP rights to token holders. Ape holders have used this to launch smaller projects, like a BAYC band, but Bored & Hungry is the first time that a real-world institution was created based on an Ape. A few weeks ago, we wrote that utility-based models, like social clubs, will be the new frontier for NFTs. This new restaurant bridges the two approaches, offering a practical purpose for a collectible token. Its success (or failure) will likely guide other investors looking to experiment with similar projects.
✨ AROUND THE INTERNET
Novel, a company that creates NFTs for corporate clients, just raised $6 million. That means you’re going to keep getting updates from us about brands that are doing NFTs.
A letter from Van Gogh where he describes his mental health struggles is going up for auction. That story comes with a price tag: $275,000.
🚨 Roblox users, you have one more day to play the Chipotle Burrito Builder. Winners get Burrito Bucks, which you can use for IRL Chipotle burritos.
A signed LeBron James rookie patch card sold for more than $1 million at auction.
FEWOCiOUS, the upstart NFT artist, sold $20 million worth of art in a 24-hour public sale. That’s the third-highest amount ever sold on Nifty Gateway.
Is eBay the new garage sale? The Australian man who found a stolen piece of Napoleon memorabilia probably thinks so.
A British man is officially Tom Brady’s biggest fan. He’s amassed a collection of Brady memorabilia that now sits in a Manchester bank vault.
