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ParaSpace Evolves into Parallel Finance, Maintaining Focus on NFT Lending

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ParaSpace, a prominent nonfungible token (NFT) lending protocol, is transforming significantly. The company is rebranding to Parallel Finance, signaling an expanded focus on the decentralized finance (DeFi) ecosystem. ParaSpace will continue emphasizing its NFT lending services, a core aspect of its operations, despite this shift.

In a recent discussion with Cointelegraph, Yubo Ruan, the founder and CEO of ParaSpace (now Parallel Finance), shared insights into the protocol’s strategy. He explained that ParaSpace utilizes diversified liquidity pools, dynamic loan-to-value ratios, and price-discovery partnerships to navigate the challenges of high volatility in the market, which often deters bidders for the underlying asset.

Ruan expressed confidence in the viability of NFT margin lending despite recent market downturns. He believes it serves a niche yet expanding group of collectors and investors who seek leverage in their investments. Over the past year, NFT trading volume has seen a dramatic decline from its peak in May 2022, but there are indications of stabilization, particularly in blue-chip collections.

Looking ahead, Ruan envisions NFTs evolving into digital passports that grant access to various virtual and real-world utilities. He also anticipates the development of soulbound tokens, which would act as non-transferable proofs of experience, skills, and reputation.

As Parallel Finance emerges from the rebranding, the protocol aims to diversify its DeFi offerings, focusing on liquid staking and Parallel L2. Parallel L2 facilitates fast transactions with low gas fees, incorporating zero-knowledge proofs and Arbitrum Orbi for enhanced security and scalability. Additionally, the integration of liquid staking with NFT lending is being explored. This would enable NFT holders to earn yields on their staked assets.

In this new framework, users would receive a tradable derivative token representing their staked investment, which could be traded or used like other crypto tokens. This approach aims to resolve the typical liquidity issues associated with staking, allowing users to pursue other investment opportunities without needing to unstake their assets.

Since its inception in 2022, ParaSpace has grown to a valuation of $500 million, boasting over 340,000 users. The company reached a peak total value of $900 million in May and merged with Parallel Finance in August, marking a new chapter in its journey within the DeFi landscape.

Jay Solano

Jay Solano

Jay is a crypto and NFT enthusiast dedicated to exploring the dynamic world of digital assets. As a crypto blog writer, he is sharing his knowledge of the latest trends, breakthroughs, and investment opportunities in the blockchain world.

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