Rocket, Borrow a loan against your NFTs. Lock NFTs to start a loan process.
A few friends called Undercollaterized #DeFi, who claimed they were willing to put valuable NFTs at stake as a guarantee for getting a loan. Let’s actually try. Let’s build a NFT Bank.
Apart from improving upon what the crypto industry calls “overcollaterization”, a core assumption of Rocket is that the NFT market will explode in the next few years. Examples include:
Event tickets: the NYC NFT event where you truly own your ticket, unlike traditional platforms. Domains names: ENS Domains, for easy-to-remember wallet addresses. Crypto Art: SuperRare & KnownOrigin, unique pieces of art that makes artist living finally sustainable online. Virtual real estate: Cryptovoxels & economically-viable VR: buy a fraction of a public world, just like in real life. Video games collectibles: Axie Infinity or CryptoKitties items that you can trade and can give you games’ benefits. And many more use cases to be discovered in the 2020's.
Another relevant thing to mention is that enough collaterized NFTs (in most cases, users will have to put down multiple NFTs, unless it’s a very valuable one) can actually reveal someone identity: as Balaji S. Srinivasan previously stated, enough “bits” (pieces of data about yourself) can reveal who you are.
Users lock NFTs down, essentially “proposing them” to Rocket as collaterals. They can also fill out this form explaining in details why they want the loan, why their proposed NFTs are valuable, how predictable their income is, and how they plan to repay.
After careful due diligence, Rocket will query funds from our lending pool, which is a Moloch-based DAO dedicated to Liquidity Providers. The pool is in ETH to remain aligned with Ethereum future, and today is worth around $10,000 of potential loans to offer. Because of this, we don’t expect to accept loans for more than $4,000 in value. It’s riskier than lending DAI on classic #DeFi, but the goal is to have better returns.
Prepare for a financial liftoff, where anyone with great NFTs can be eligible for a loan.
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