Tokenized FTX claim is used as collateral for a loan

cointelegraph.com:

A creditor of now-bankrupted crypto exchange FTX pledged a claim as collateral for a loan in the decentralized finance (DeFi) protocol Arcade. The transaction was the first on-chain loan backed by a FTX claim, according to the bankruptcy claims platform Found.

The claim worth $31,307 was tokenized and its ownership represented by a nonfungible token (NFT). The NFT was then used on June 23 as a collateral for a $7,500 loan to be repaid in five days. In the event of a payment default, the lender is entitled to the claim.

✨Congrats wagmiclaims.eth for being the first onchain #RWA loan backed by a #FTX #bankruptcy claim WAGMI is happy to have some spending cash for the @Azuki Vegas party this weekend Special thanks to @Arcade_xyz for building a great platform pic.twitter.com/l8n8jGyKpp

The transaction is an example of real-world assets (RWA) tokenization, in which a token represents an asset's ownership rights on a blockchain. Within DeFi, asset tokenization is one of the most prominent areas as a wide range of real-world assets can be tokenized, including stocks, government bonds, real estate, and commodities.

On Twitter, Found said both the original creditor and lender went through its biometric Know Your Customer (KYC) and Anti-Money Laundering (AML) screenings. According to the company's website, it allows users to access loans using bankruptcy claims as collaterals under a 10% transaction fee on successful trades.

Crypto exchange FTX filed for bankruptcy in November 2022, locking billions of dollars in users' accounts for court proceedings. According to some estimates, FTX claim holders could recover between 35% and 66% of their face value.

Crypto-related bankruptcy cases have flooded the courts in the past year, many