Specialist short-term luxury asset lender, Suros Capital, has announced it will be adding NFTs (non-fungible tokens) to its roster of assets the company offers finance against.
NFTs have boomed in popularity in recent months, and it seems a natural step for asset lenders to consider alongside the mix of luxury items they will lend against.
Speaking about this latest development, Suros Capital co-owner, Paul Aitken said in a statement shared with Finbold.com:
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“Our business is essentially about helping people with valuable assets to quickly raise short-term finance to support growth opportunities. As NFTs become more recognised for their value, it’s important we move with the times and bring this area of expertise into our business so we can both appraise and lend against it.”
The company typically lends against luxury assets such as fine art, wine, diamonds, and watches, as well as classic and luxury cars. When taking an asset against a loan, the company arranges for storage either in its own vaults or specialist art, wine, or car storage facilities. According to the firm’s official, the fact that NFTs only exist in the digital world presents both an opportunity and a challenge. Mr. Aitken continues.
“Not having to carefully store and insure delicate assets is a plus point, but the fact that ownership of NFTs is written into blockchain code held on thousands of computers around the world presents other challenges. We have therefore needed to adapt our business to protect the capital we lend against these assets.”
To do this, Suros Capital has opened its own digital wallet. Just like transferring ownership of a car, the owner of the NFT will need to transfer their digital ‘key’ related to the artwork into the newly created Suros Capital Ethereum Wallet. There is then an additional level of security:
“The final step will be to store our offline hardware wallet in our vaults for added protection,” concludes Mr Aitken.
Suros Capital will lend from £20,000 to £2million, and in this initial phase, the company caveats that it will only lend against NFTs with an auction track record. There have been a number of sales of NFTs at both Christies and Sotheby’s in recent months, including the $69 million Beeple work.
