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December 25, 2021

Kraken Exchange Will Launch Custodial NFT Marketplace Next Year

Jesse Powell, the founder and CEO of Kraken cryptocurrency exchange, has announced plans to extend his company’s services to NFT customers in an effort to contribute to the expansion of the non-fungible token (NFT) market.

According to a Bloomberg article, the exchange would create an NFT marketplace that will allow enthusiasts to investigate the usage of NFTs for a variety of purposes, including collecting digital art and providing custodial and lending services.

During the event, Powell highlighted that the exchange will implement a mechanism that will allow consumers to use their NFTs as collateral to borrow cash.

“If you deposit a CryptoPunk on Kraken, we want to be able to reflect the value of that in your account. And if you want to borrow funds against that. Kraken is working on a system to determine the liquidation value of the NFT deposited.”

The planned expansion appears to have been prompted by a recent tendency among major cryptocurrency exchanges to enter the NFT field and begin to provide non-fungible tokens as a service.

Binance and FTX Exchange just opened their own NFT marketplaces, and Kraken is expected to follow suit early next year.

Powell added that the development is a means for the exchange to stay up to current on the usage of non-fungible tokens in 2022, as he anticipates that the number of use cases for non-fungible tokens would increase.

“Phase one was speculation, phase two was buying art and supporting artists, and phase three will be functional usage of NFTs,” he noted, citing current NFT use cases and forecasting the market’s prognosis for the future year.

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