Apart from the high trade volumes on NFT platforms, NFTs are well-positioned to change the face of finance in the future. The use of Decentralised Finance (DeFi) is a major example. DeFi refers to the provision of financial services without using a third party. Hence, experts in the digital space have been hinting at the integration of NFTs into the DeFi network.
With this integration, DeFi users will be able to get loans by using their NFTs as collateral. This way, they would not have to withdraw their NFT investments to fund their needs. In cases where these users default on paying their loans, the platform will deploy a smart contract to transfer the NFT collateral to the creditor. Some platforms have begun to adopt this concept.
For example, Drops DAO has added a feature of instant loans for its users. Users will be guaranteed immediate loans in exchange for a valuable NFT as collateral by using this feature. It is expected that this trend will become mainstream in the coming years.