- Chainlink has introduced NFT lending and renting.
- This will enable NFT owners to earn income on their NFTs and provides a more affordable way for individuals to access special perks and utilities that come with owning an NFT.
In a blog post, Chainlink Explained how, like other blockchain assets, NFTs can be embedded in smart contracts, unlocking a range of advanced features that, like DeFi, were once unimaginable for fungible tokens.
lending and renting are providing a new way for players to earn yield on their holdings while enabling game developers to create new revenue streams. Why rent an NFT? Many NFTs enable their owners to access special perks, utilities, and gameplay experiences.
The concept behind NFT Lending and Renting?
Basically, Individual players will be giving temporary ownership of their NFT to other players in exchange for some money as a reward. For blockchain gaming, players will be lending out in-game assets, such as characters or virtual land, to someone else for a certain amount of time. in a tweet Chainlink. In a Tweet, chainlink said this will be another source of revenue for developers.
#NFT lending and renting are providing a new way for players to earn yield on their holdings while enabling game developers to create new revenue streams.
Why rent an NFT? Many NFTs enable their owners to access special perks, utilities, and gameplay experiences. pic.twitter.com/9Zjw4ZZ9h0
— Chainlink (@chainlink) April 20, 2023
Borrowers will get to use these assets without actually having to buy them, while lenders can make some extra cash from the fees that borrowers pay. It’s a win-win situation! Plus, borrowers get to show off their cool NFT as a status symbol online.
Also read: Chainlink BUILD Program Welcomes Akron Finance to Accelerate Adoption of Akron Crossing Network in DeFi Space
Types of NFT Lending and Renting
When it comes to NFT lending and renting, there are two main types to know about collateralized and uncollateralized.
Collateralized NFT Lending: With collateralized NFT lending borrowers will need to put up some kind of collateral, usually, cryptocurrency or another NFT, to make sure they’ll be able to pay back the value of the NFT they’re borrowing. This is all handled through a lending smart contract, which ensures that everyone plays by the rules.
Uncollateralized NFT Lending: This doesn’t require any collateral. Instead, the lender has to rely on trust and reputation systems to determine if the borrower is trustworthy enough to pay back the borrowed NFT. This setup typically comes with higher interest rates since the lender is taking on more risk without any collateral.
Upside to Chainlink Introducing lending and renting
One of the biggest reasons to rent an NFT is that it gives you access to special perks and utilities that come with owning that NFT, like exclusive content, communities, events, or the ability to create another NFT.
Renting an NFT is a more affordable way to enjoy those perks without actually having to buy the NFT. And NFT owners can earn income on their NFTs, which might otherwise just sit in their wallets.
For gamers, renting out their in-game assets to other players can be a big money-maker. Borrowers get access to the NFTs for a short period, which lets them try out new gameplay and access expensive or rare in-game items and experiences. It’s a win-win for everyone involved.
Game developers can also benefit from NFT lending by creating their own lending marketplaces that let players transact with in-game assets. This can create a new revenue stream for developers without having to charge players for downloadable content.
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Finally, chainlink’s NFT lending can open up new business opportunities in the metaverse by allowing people to lend avatars, virtual land, or real estate represented as NFTs. It’s an exciting new frontier for entrepreneurs and investors alike!
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