The NFT lending market is falling to its lowest level since 2022, with total value locked (TVL) at only about $8.3 million — a 97% drop from the peak of over $300 million in March 2024. Major platforms have been heavily affected: Arcade, once backed by Pantera Capital, now has only $300,000 TVL, down 98% from its peak of $21.5 million. Blur’s Blend, which once dominated thanks to strong incentive programs, has also dropped more than 90% to around $3 million.
According to NFT Price Floor co-founder Nicolas Lallement, the sharp decline began when Blur’s incentives ended. The market is now shifting to a more sustainable model led by Gondi, with collateral assets leaning toward art NFTs instead of highly volatile PFP collections. Although TVL has plunged, the outstanding NFT debt has decreased by only 45%, indicating that borrowing demand still exists despite a sharp drop in liquidity.
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