YieldNFT is a peer-to-peer marketplace that allows generating yield from idle NFTs. Holders can put up their NFTs as collateral and lenders with access to liquidity can offer capital against these collateral NFTs. The capital thus raised will be used in promising (automated) yield generation strategies across DeFi. The yield thus generated will be distributed between the participants.
When a liquidation occurs in the DeFi strategy employed, the lender can get the NFT.
There are several NFTs already available in the market with their value constantly going up. There are several collectors who buy these NFTs at very high prices. But once a collector acquires an NFT, there isn't much value generated from it, while sitting around idle inside their wallets. These NFTs can generate returns for the collector only in its next sale, and that too by having to cede ownership.
There aren't many platforms around that make use of such idle NFTs.
YieldNFT can help collectors to use their idle NFTs to generate passive income for them, without them having to give up their ownership.
For lenders who are looking for high yield investment opportunities in DeFi, they can invest in such strategies with less effort (automated), while hedging the risk of being liquidated which they would've had to bear, had they invested in them directly.
Since NFTs are collectibles, there is often huge value associated with them. This protocol enables to passively exploit that huge value using a win-win strategy
NFT holders can list their NFTs in the marketplace as open for offers from lenders. Lenders checking the marketplace for listed NFTs can then see the NFT and make offers. Once the NFT holder and lender reach a consensus around the offer and the yield generation strategy, the NFT along with the funds offered by the lender will be transferred to the protocol's escrow contract.
The capital offered by the lender will be invested in one of the high risk, even leveraged yield generation strategies across DeFi, by the protocol. The protocol would then keep accruing yield from these strategies. The yield thus generated will be shared between the NFT provider and the lender, generating passive income off of the otherwise idle NFT.
If and when a liquidation event occurs in the investment strategy used by the protocol, the NFT locked up by the provider would be transferred to the lender's wallet giving the lender full ownership.
TL;DR 👇
Alice: NFT Provider / Borrower
Bob: Lender