Decentralized finance (DeFi) lender Teller has introduced a buy now, pay later (BNPL) service for blue-chip non-fungible tokens (NFTs) like Bored Ape and others.
According to Bloomberg, intending buyers will pay a mandatory between 25% to 50% of the NFT value and the balance can be spread into installments.
Teller has named the service “Ape Now, Pay Later” and has built it on the Ethereum Layer 2 network, Polygon.
Ryan Berkun, the founder and CEO of Teller, said the service provides NFT enthusiasts with access to affordable financing to buy some of the priciest NFTs like Bored Ape, Mutant Ape, Adidas Originals: Into the Metaverse, Doodles, Meebits, and Azuki.
How Teller’s BNPL works
The major difference between how Teller’s BNPL and those of the traditional financial startups like Klarna operate is in the funding style.
According to available information, a user (borrower) that wants a blue-chip NFT can specify the asset he wants to purchase via the Teller platform. He is then expected to make the required down payment to make the purchase.
Teller proceeds to match the borrower with a lender who funds the purchase. The NFT is held in escrow until the borrower successfully repays his debt. This scheme will allow lenders to earn as much as 30% annually and would also allow easy financing for these blue-chip NFTs, thereby democratizing its access.
Crypto winter impacts NFT market
Teller’s new service is coming at a time when the broader crypto market is still trying to recover from the record lows it traded for in June.
Bitcoin, Ethereum, and other digital assets lost over $400 billion of their value in the last 30 days.
The NFT market was also impacted by this market crash, as the value of some blue-chip NFTs plunged by as much as 40% due to the broader market drop. According to DappRadar, demand for NFTs remains up despite the decline in trading volume of the space.
An indication of this is OpenSea, the leading NFT marketplace, which made major acquisitions and developments to retain its status as the dominant player in the market.