The digital assets ecosystem continues to evolve, with groundbreaking projects such as pETH gaining prominence. pETH is a unique Ethereum derivative that is backed by the JPEG'd protocol. This new form of asset is minted whenever a user decides to borrow against their NFT (Non-Fungible Token) and is destroyed once the loan is repaid.
pETH and the JPEG'd Protocol
pETH's function within the JPEG'd protocol is quite unique. The token is used as collateral when borrowing against an NFT. The JPEG'd protocol, in essence, supports the minting and also the subsequent burning of pETH, contributing to the dynamic nature of this asset.
Interest Rates Involved with pETH
It's essential to note that borrowing against an NFT and minting pETH entails an interest rate of 5%. This rate is slightly higher than the 2% interest rate associated with borrowing PUSd. It's part of the unique financial dynamics that underpin the functioning of the pETH token and the broader JPEG'd protocol.
Significance of pETH in the NFT Market
pETH plays a significant role in the rapidly growing NFT market. By allowing users to borrow against their NFTs, it provides additional liquidity and flexibility. The nature of pETH, being minted when borrowed against and burned upon repayment of the loan, creates a fluid dynamic that can potentially drive further growth in the NFT space.
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