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Dapper Labs, a National Basketball Association partner, is assisting in the flow of NFT loans on the blockchain

On an early $175,000 investment in NBA Top Shot, a non-fungible token marketplace where sports fans can buy and trade video highlights of basketball players, Michael Levy created a $20 million fortune in just 6 months.

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Then, as the initiative grew into a multibillion-dollar business, Levy and a few other early adopters came up with the concept of a decentralized lending network where users could borrow money against Top Shot “moments.” They named it Flowty in honor of Top Shot’s host blockchain Flow.

The campaign drew the attention of NBA Top Shot and Flow creator Dapper Labs, which joined Greenfield One and Lattice Capital as investors in Flowty’s $4.5 million seed round, which was disclosed today.

Dapper Labs’ chief business officer Mik Naayem adds, “We’ve always had this idea around games being the entryway to people decentralizing their lives.” He believes Flowty is “critical” to demonstrating that thesis.

According to Levy, Flowty’s cofounder and CEO, the site works similarly to a pawn shop, with the exception that there is no middleman. The borrower creates a listing, specifying the desired terms and securing the loan with a single NFT. If someone decides to fund it, they will either receive interest on their money or the borrower’s NFT, which will be locked inside the platform. The listing becomes invalid if the NFT is transferred out of the borrower’s wallet before the loan is funded.

On a loan, Flowty collects 10% of the interest paid by the borrower. FLOW, FUSD (the Flow blockchain’s dollar-pegged stablecoin), tUSDT (the Flow blockchain’s version of Tether), and USD Coin can all be used to make loans. There are no internal ratings or consumer audits.

“We do not, in any way, shape, or form, provide underwriting services.” On individual loan postings, we do not provide advice. Levy points out that “we never custody the collateral and we never custody the tokens.” “We are merely a technological corporation by legal and regulatory criteria.”

What could possibly go wrong? A few points to consider: the NFT or cryptocurrency in use may lose a significant amount of value over the loan duration. “The borrower will most likely not repay,” Levy adds, “and then you’ll receive an NFT valued less than your loan amount—the that’s risk you’re taking.”

Borrowers with outstanding loans may lose access to their accounts, or the site may be hacked. In a phishing assault in February, hundreds of NFTs were stolen from users of the main NFT marketplace, OpenSea. Not to mention the fact that the Flowty loan is a complicated transaction in and of itself. The entrepreneurs don’t hold back when it comes to stating the hazards.

“I wouldn’t recommend [Flowty] to someone who doesn’t know what NFTs are or what NBA Top Shot is,” Naayem explains. “But I think it’s a terrific way for individuals who have spent time with it, evaluated it, and understood the risks and rewards to interact with that portion of the ecosystem.”

Flowty has completed over 150 loans with an average amount of $4,000-5,000 since its beta debut less than three months ago. Although the stats are modest, the company is already considering adding more NFTs (now only NBA Top Shot and Ballerz collections are supported) and branching out into other chains.

Despite market fatigue (according to market tracker NonFungible, the average sale price of an NFT fell from over $6,800 at the start of the year to below $2,000 in March), platforms like Flowty are actively raising cash. MetaLand, an NFT lending platform, said yesterday that it has raised $5 million in seed funding lead by Pantera Capital, a crypto investment firm.

ART & COLLECTABLES

NHL Opens Hockey Collectibles NFT Marketplace

The NHL, along with its Alumni Association and Players’ Association, said on Thursday that it has joined with NFT platform Sweet to build a distinctive NFT marketplace and libraries of NFTs—individual blockchain tokens that denote ownership.

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The NHL’s market will fall between a full-fledged NFT trading platform and a website that enables momentary NFT drops, according to David Lehanski, the league’s executive vice president of business development and innovation.

By creating an NFT marketplace with exclusive releases, the NHL hopes to give fans a little bit of both. In preparation for the commencement of the 2022–2023 season, the NHL’s Sweet marketplace is anticipated to launch in October.

The NHL aims to gamify NFTs with “questing and collecting” components so that fans will interact and can be rewarded with benefits like other NFTs, according to Lehanski, who spoke to Decrypt.

Depending on a player’s performance, some of the NFTs will also be dynamic and alter over time. According to a statement, NFTs will also include “cinematic game highlights from past and present NHL seasons” or surprise packs of NFTs that may be seen in “3D interactive trophy rooms.”

Lehanski claimed that the NHL wasn’t yet ready to reveal which blockchain it would be constructing on. Though it might be on Polygon or Tezos if Sweet’s offerings are any indicator.

Lehanski stated, “We’re looking at everything,” and that the NHL’s top priorities in its search for a blockchain include “cheap gas expenses” and “environmental sustainability.”

The NHL is one of the most recent major professional sports leagues to enter the NFT market, following the NBA’s Top Shot NFTs, the NFL’s “play and own” NFT game, and MLB’s impending NFT contest.

Lehanski commented on the NHL’s approach to NFTs, saying, “There was clearly a lot of temptation to potentially moving very rapidly […] but we thought that was a little shortsighted.” He added that, in his opinion, spending the time to investigate indicators like fan behavior was worthwhile. Especially in relation to digital collectibles and gaming, NFTs have a long-term future as relevant and meaningful items for enthusiasts.

But according to Sweet CEO Tom Mizzone, the NHL’s NFTs won’t simply be targeted at hockey fans who are unfamiliar with cryptocurrencies; seasoned NFT collectors will also be able to participate in a way that feels natural to them.

It will undoubtedly appeal to that degen culture, he continued, but not to the extent that it excludes fancier consumer bases.

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NFT

MoonPay has officially launched HyperMint, a utility NFT minting service

MoonPay, a cryptocurrency payments company, announced Tuesday the debut of HyperMint, a new service that allows businesses to mint up to 100 million non-fungible tokens (NFTs) at once.

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Creators and companies can use the new service to attach photos, music, video, and other metadata to a token on their own platform.

MoonPay had been expanding its service since April, according to The Block. Its official debut is another step in the company’s strategy to build a full suite for businesses looking to release their own digital assets, which it previously referred to as “Amazon Web Services for NFTs.”

“Why take your intellectual property and list it on a secondary platform first, whether you’re Dolce & Gabbana, Selfridges, or Death Row Records?” In an interview with The Block, MoonPay CEO Ivan Soto-Wright said, “You might want to oversee that issuance yourself.”

Fox Corporation, Creative Artists Agency (CAA), Universal Pictures, Death Row Records, the United Kingdom-based luxury store Selfridges, lifestyle and gaming platform FaZe Clan, and music artist Timbaland’s Beatclub are among the companies that have already signed up.

Proof of attendance tokens, for capturing how many individuals attended an event, is one possible use case, according to Soto-Wright.

These digital assets would be utility tokens, as opposed to security tokens, according to MoonPay. Security tokens must be registered with regulatory organizations such the Securities and Exchange Commission in the United States.

MoonPay’s product portfolio already includes a fiat onramp infrastructure that allows people to buy NFTs using a debit or credit card, as well as a concierge service that educates high-net-worth individuals about cryptocurrency. MoonPay has also been rumored to be working on its own wallet in the future.

The introduction of HyperMint comes at a time when many of the most popular NFT projects have seen significant price declines due to the crypto bear market.

Because of their use cases, Soto-Wright believes NFTs will become shielded from broader market situations.

“I believe NFTs will be unpaired [because to crypto market conditions].” But I believe that will be unpaired in part due to the innovation that will accompany this asset class – you’ll see a slew of various NFTs that aren’t solely focused on the price movement of these assets.”

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Crypto and NFT-related accounts are prohibited on WeChat in China

Secondary NFT trading is also included by the policy, as the firm adds that “accounts that provide services or material connected to the secondary transaction of digital collections shall be dealt with.”

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WeChat, China’s most popular social media platform, has revised its policy to prohibit accounts from providing access to crypto or nonfungible token (NFT)-related services.

Accounts involved in the issue, trading, and financing of crypto and NFTs will be restricted or prohibited under the new standards and will fall under the “illegal business” category.

The corporation notes that “accounts that supply services or material relevant to the secondary transaction of digital collections will likewise be handled in accordance with this rule.”

On Monday, Hong Kong-based crypto news writer Wu Blockchain (Colin Wu) noted the move, pointing out the significance of the move given WeChat’s 1.1 billion daily users in China.

“Once such breaches are identified, the WeChat public platform will depending on the severity of the violations, instruct the violating official accounts to rectify within a time limit and restrict some features of the account until the permanent account is banned,” according to the new policy.

Between May and September of last year, the Chinese government implemented a phased ban on the local crypto sector. Given the time of the most recent WeChat policy amendment, it’s possible that the platform has been allowing some crypto activity to go undiscovered since then.

Furthermore, because the assets can be purchased in fiat, there is still a regulatory gray area in the country when it comes to NFTs. Nonetheless, to prevent potential regulatory difficulties related to the financialization of technology, most organizations and platforms prohibit secondary trading.

In April, the China Banking Association, the China Internet Finance Association, and the Securities Association of China issued a joint statement warning the public about the “hidden hazards” of investing in the assets.

Since March, popular platforms such as WeChat and the Ant group-owned WhaleTalk have been distanced from the technology, purportedly eliminating or banning NFT services from their networks due to a lack of regulatory clarity and fear of a Beijing crackdown.

Despite this, a local media report published on Thursday highlighted data revealing that the number of digital collectable platforms in China has increased by fivefold since February 2022, to over 500.

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