NFT and digital asset news on August 21, 2022. BendDAO is causing concern with the potential liquidation of the NFTs, food giants continue to explore the NFT and blockchain space.
BendDAO NFT Auctions
BendDAO is a decentralized autonomous organization, meaning hierarchy and decision making is left to community votes and automated smart contracts. The DAO offers loans, accepting specific NFTs as collateral. NFT owners can put up their Bored Ape in exchange for the loan, if the floor value of the NFT drops below 95% of the loan, the DAO has the right to auction it. Investors put up capital for the loan witch earns them rewards or interest.
Within the last 24 hours, the DAO was forced to auction several NFTs due to the floor price of the collection. This put several high-value NFTs up for auction, below what is believed to be a fair price. This happens so the DAO can make the capital back for the lender. Some of these NFTs may be purchased by their owners as to not take a loss on the sale of the asset. The concern with the situation, is the increased supply of these high-value NFTs hitting the open market below the floor price all at once.
With so many NFTs hitting the open market, underfloor prices, it could cause the collections to spiral downward. The website for the organization suggests 13,500ETH in the reserves, with 14,500 ETH borrowed. This could mean that liquidity is being drained from the protocol by concerned users, possibly leading to further downfall. BendDAO is an interesting mix between Web3 and Decentralized Finance, bringing the DeFi space to NFTs. The impact on the market and how the DAO proceeds will be large indicators of the future for DeFi and NFTs.
Kraft Food Files NFT Patent
Kraft Food, the corporation responsible for the most popular Mac n Cheese in America, has just filed NFT-related patents. The patent covers both NFTs and the metaverse and is related to many of the Kraft brands. Patented trademarks include for Jell-O, Kool-Aid, Velveeta, Lunchables, Oscar Meyer, Philadelphia and the general Kraft brand.
This comes after the industry saw several food giants exploring the space, including Taco Bell, Gatorade, Burger King and Coca-Cola. A Bored Ape holder even used his IP to open a restaurant, Bored n Hungry. As all sorts of different business models dive into the NFT space, watching how food establishments proceed will be very interesting.
Investing in Web3 and blockchain technology has only increased in the past six months. Some of the world’s largest companies dumped billions of dollars into blockchain, including Google, Samsung, BlackRock and Morgan Stanley. BlackRock is no surprise after the announced partnership with Coinbase while Samsung, Google and Animoca Brands have quietly been growing into blockchain giants.