KuCoin, a global cryptocurrency exchange headquartered in Seychelles, announced on Friday the introduction of an exchange-traded fund (ETF) tied to major nonfungible token (NFT) assets such as Bored Ape Yacht Club (BAYC).
Following the event, KuCoin has created NFT ETF Trading Zone, a new investment product where consumers may buy and sell ETF NFTs, in collaboration with NFT infrastructure provider Fracton Protocol.
The investment offering allows retail investors to purchase fractional ownership of leading NFTs via ETFs accessible to KuCoin customers.
KuCoin CEO Johnny Lyu said on the development: “We are very excited to become the first centralized crypto exchange to support NFT ETFs, allowing consumers to invest and trade leading NFTs directly with USDT. In the future, KuCoin will continue to investigate further NFT-related products for our consumers.”
The KuCoin NFT ETF is a Tether (USDT)-based product that represents particular underlying NFT assets.
The ETF aims to increase liquidity by providing exposure to NFTs via the USDT stablecoin as opposed to Ether (ETH). It also avoids the risks and complications associated with managing NFT infrastructure components like as wallets, smart contracts, and marketplaces such as OpenSea.
Fracton Protocol, a service specializing in fractionalizing useful NFTs into fungible Ethereum-based ERC-20 tokens, is collaborating with KuCoin to offer a suite of ETFs denominated in USDT stablecoin.
The ERC-20 tokens contained within KuCoin’s NFT funds represent 1/1,000,000 ownership of major NFT assets, allowing users to own proportionally shared ownership of major NFTs.
KuCoin’s ‘NFT ETF Trading Zone’ will initially list 5 NFT ETFs covering Bored Ape Yacht Club (BAYC), CryptoPunks (hiPUNKS), Koda NFTs (hiKODA), hiSAND33, and hiENS4 as underlying assets.
KuCoin’s efforts to accelerate the launch of the NFT market by lowering the funding threshold for key digital collectibles have reached a major milestone with this statement.
KuCoin has focused on developing the NFT market. In April, the competitor introduced Wonderland, an interactive NFT launch platform for cryptocurrencies and traditional video games. Wonderland enables users to have an integrated and centralized experience when purchasing, investing, and managing in-game NFTs.
In May, KuCoin launched Windvane, an additional NFT marketplace that offers an NFT launchpad, NFT mint, commerce, administration, and a number of other services.