GateLive AMA Recap-NFTfi
Q1. What is NFTfi?
NFTfi is the most battle-tested lending and liquidity protocol for NFTs. NFTfi allows NFT holders to borrow ETH, USDC, or DAI from lenders by using their NFTs as collateral in a trustless peer-to-peer (P2P) fashion.
Q2. What is NFTfi origin story?
NFTfi emerged from the earliest NFT OG circles - our founders were both programmers and large CryptoKitties whales themselves who needed a protocol to give each other loans against their NFTs. Due to these NFT-native origins and after almost 4 years of iterating on Ethereum Mainnet, we believe to have a very mature protocol design philosophy and a very clear picture of how we have to build and evolve our protocol features to scale fast in this next cycle, and to emerge as the leading settlement layer for NFT financial transactions long-term. We strongly believe that the peer-to-peer lending model will remain dominant due to its inherent better fit with non-fungible assets, complemented by liquidity scaling solutions (pool-based and non-pool based).
Q3. What are the important news in the NFTfi eco?
We are starting to see more and more Real World Assets coming onchain and becoming worthy lending collateral. Notable achievements include introducing the first Real Estate Tokenized loan (RWAs) and enhancing DeFi composability in NFT lending.
Examples of partnerships
~ Token stream integration with Sablier
~ Collaboration with SudoSwap
~ RWAs; Bringing real estate and collectible lending markets on-chain with partnerships like Fabrica Land and Watches.io
Q4. What is the difference between the other lending protocols?
NFTfi is is a fixed-duration lending without auto-liquidation. Also called peer-to-peer lending, it is one of the best options for borrowing wETH, USDC, or DAI from lenders using NFTs as collateral. This model usually offers better terms on specific or rare NFTs, and there is no auto-liquidation risk making sure the user stays in control. Key projects include NFTfi, Gondi or Arcade
Another model frequently used is perpetual lending with auto-liquidation Also known as peer-to-pool lending, this model allows borrowers to obtain instant liquidity using NFTs as collateral from a liquidity pool, with no expiry date. To safeguard lenders, the NFTs can be liquidated when their value falls below a certain floor, using oracles to monitor the price. Key projects include, BenDao or Blur/Blend.
Q5. What is the future of NFTs?
NFTs are more than just JPEGs. They manifest a whole new world of opportunities across many industries, and they are changing lives. They massively empower the creator economy, enable global communities to reshape internet culture, and usher in a new era in gaming and music. NFTs are becoming a core building block of the web.
We are observing a significant transformation in the NFT market, characterized by three deep trends:
NFTs have established cryptocurrencies as a unit of account for purely digital objects. Yet in the physical world, the inherent value of most assets is non-fungible. Assets such as real estate, art, vehicles, and furniture typically increase in uniqueness and, consequently, in value over time. We anticipate that cryptocurrencies will experience a similar monumental shift, reflecting the historical progression of asset valuation and trade.
As technology evolves and the market matures, NFTs will encompass larger value pools. Its application will extend to tokenized collectibles, real-world assets, gaming assets, trademarks and patents, financial contracts, music royalties, intellectual property, etc. Each of these areas offers vast opportunities for growth and innovation.
The NFT space is moving towards greater composability and developing more sophisticated financial instruments, such as enhanced fractionalization and derivatives (perpetual contracts and options for instance). These instruments will fuel the next bull run similarly to how it catalyzed the adoption of cryptocurrencies.
