NFT are the new form of capital. Their utilisation as collateral in the DeFi ecosystem is desirable and inevitable.
The recent launch of Fuse by Rari is an opportunity to put this capital to work.
Project
Rari Capital, recently launched Fuse; an isolated interest rate market. In a nutshell: a market on which you can select autonomously the collateral supported and the risk framework associated.
I propose the creation of a NFTX market composed of the most liquid pools on Sushiswap. Selecting the more liquid asset is fundamental to providing Rari the certitude liquidation will be done at a competitive price. Based on the Aave risk framework, I provided those potential settings for the market. This needs to be challenged.
In addition to the evident benefits that getting leverage on NFT brings, this integration will
reaffirm the will of NFTX to build innovative, useful tools at the intersection of DeFi and NFT.
In the spectrum of what has been done with PieDAO, the partnership with RariCapital would be the occasion to communicate on the first solution to offer āNFT as collateralā while making those two dedicated communities closer.
Implementation
I donāt see any difficulty in implementing this. Rari is waiting for a NFTX representant to contact them if the community wants to be part of the safeguarded launch of Fuse.
Paging @willprice and others to have a look at the implications of this. Happy to move this through and can assist anywhere you need me once the idea is cristalized
āNFT as collateralā was pretty much the first use case that came to mind when I heard about NFTX so I love that we can potentially get the ball rolling on this.
Am a big supporter of the idea and think thereās plenty of ways we could promote it within our consumer apps as another value-add of minting an XTOKEN.
Great idea, using NFTās as collaterol is a huge benefit and NFTX should be one of the first movers in this space!
One point I would make is AXIE & Kittys on your tableā¦
A loan to value of 5% and with relatively low liquidity (Compared to the others) makes me wonder if these will ever get usedā¦ There is not too much value in a 5% loan to value IMO.
TIL of the āNFTX Poolā Fuse Pool of NFTX (I apologize for digging up this thread from past year ), I have been reading through the comments over here.
If I may, Iād like to address the following paragraphs, outlined:
In this specific pool (NFTX Pool) there are 3 stables (+ ETH) that lenders can deposit to gain interest rates, and 5 assets users can deposit as collateral to borrow the stables against (with varying Collateral Factors/ LTV for each asset according to its risk parameters).
Consider for a moment having a backstop option, an additional layer in the liquidation process, and more specifically an integration with with Backstop Protocol (b.protocol), which would allow for:
the offering of higher Collateral Factors (LTV) due to a more robust liquidation mechanism.
No need to run liquidation bots by 3rd parties or by the team (democratizing the liquidation process).
Risk analysis of the market that can provide quantifiable insights into each asset in the pool.
Hey guys! Coming in a bit late, but I assume the NFTX Fuse pool has been running for a while now. As I can see it only has PUNK and WIZARD as its NFT collaterals, will you agree it needs updating? Since the TVLs of the pools on NFTX has changed and now there are also OTHR, DOODLE, MILADY, MAYC, MEEB that have higher liquidity than WIZARD. This would almost certainly make NFTX Fuse pool attract more liquidity. But does it require creating a new NFTX pool in Fuse, or can the existing one be updated?
), I have been reading through the comments over here.