Potential BAYC NFT Liquidations Could Cause An Overall NFT Market Downturn

Bored Ape NFT liquidation cascade is inevitable in accordance with Web3 launchpad founder “DoubleQ”Many BAYC holders who deposited on BendDAO in trade for $ETH are in threat of being liquidated.OpenSea NFT volume happens to be at its lowest point within the last twelve months.

The Bored Ape NFT holders are not bored at this time to be a potential cascade of liquidations looms over on NFT liquidity Pool BendDAO.

BAYC holders that deposited their NFTs on BendDAO in trade for $ETH, are actually vulnerable to being liquidated which has a health factor of just one 1.01 according to data collected from BendDAO.

“DoubleQ,” the founder of Web3 launchpad DoubleStudio, claims on Twitter that BAYC loan liquidation gets the potential to nuke the complete NFT Market.

BendDao can be an NFT lending protocol that provides 30%-40% on the NFT’s floor price as loans. Normally, this is utilized by market participants who need liquidity in ETH but usually do not desire to sell their blue chip NFTs. However, where medical factor is leaner than 1, NFTs are certain to get liquidated, as explained by the below example.

You can find currently 20 BAYC, under 1.1 health factors and much more and 1.2, that could set a liquidation of around $55m worth of NFTs.

Opensea NFT volume happens to be at the cheapest point it includes ever experienced the last twelve months, meaning there will never be enough volume to save lots of these NFTs from liquidations. Borrowers could have 48 hours to settle the loans or their collateral will undoubtedly be liquidated.

DoubleQ, believes the next could be a fantastic opportunity to choose the NFTs at the cheaper rate by either :

-bidding on loans and flipping them after

-waiting for any mass liquidations to really have the best entry way to these NFTs.