Despite rebranding to Parallel Finance for a greater focus on the decentralized finance (DeFi) ecosystem, the nonfungible token (NFT) lending protocol ParaSpace will continue to focus on its core product amid sector woes.
In a conversation with Cointelegraph, Yubo Ruan, founder and CEO of ParaSpace (now Parallel Finance), explains that the protocol uses a combination of diversified liquidity pools, dynamic loan-to-value ratios, and price-discovery partnerships to mitigate the risks associated with high volatility, which can often result in a lack of bidders on the underlying asset.
“Despite the market downturn, we believe NFT margin lending remains viable,” said Ruan. ” It serves a niche yet growing sector of collectors and investors looking for leverage in their investments.”
During the past year, NFT trading volume has plunged by 99% from its peak in May 2022, although there have been signs of stabilization with blue chip collections. “In the near future, we see the implementation of NFTs as digital passports that enable access to both virtual and real-world utilities,” Ruan commented. “Also, we’re looking at the evolution of soulbound tokens that serve as non-transferable proofs of experience, skill, and reputation.”
As the protocol rebrands to offer a greater variety of DeFi services, Ruan says the two main focuses are liquid staking…
