Introduction to Lendz
Lendz operates similarly to Skyscanner, but instead of flights, it navigates the complex world of NFT loans. It assists users in securing cryptocurrency loans against their NFTs at the most competitive rates, thanks to its powerful aggregation capabilities.
Vision and Mission
The mission of Lendz is to elevate the NFT lending sector by enhancing the overall customer experience. Lendz focus on a borrower-centric approach, ensuring that NFT enthusiasts can access the lowest-cost crypto loans available. Lendz' objectives include advancing crypto integration, speeding up liquidity access, and streamlining the borrowing process against NFT collateral. Lendz is committed to making NFT lending more affordable, efficient, and beneficial for both seasoned investors and newcomers.
Understanding NFT Lending
Consider owning high-value NFTs from prestigious collections like Bored Apes Yacht Club or CryptoPunks, each worth a significant amount of Ethereum. If you suddenly require liquidity but lack sufficient funds and are reluctant to sell your assets prematurely, NFT lending offers a viable solution.
The Role of NFT as Collateral
In the crypto world, trust is earned, not given freely, hence unsecured loans are virtually non-existent. Blue-Chip NFTs serve as a reliable form of collateral in securing loans.
How Lendz Facilitates NFT Lending
Lendz aggregates loan offers from various lending protocols, presenting you with a curated list of options based on your NFT's value and characteristics. You select the most favorable terms and proceed with the loan, maintaining ownership of your NFTs while accessing needed funds. Should you repay within the agreed timeframe, your NFTs are returned. Failure to meet repayment terms could lead to liquidation of your NFTs to satisfy the debt, depending on the specific protocol's rules.
Key Concepts in NFT Secured Loans
- Floor Price: This is the lowest price at which an NFT can be bought within a collection and is a critical factor in determining the loan value.
- Loan Amount: Influenced by the NFT's value, floor price, volatility of the collateral, and the lender's policies.
- Interest: This is the fee charged for borrowing, typically a percentage of the loan accruing over its duration.
- Duration: The repayment period can vary by lender and loan size, often ranging from days to months.
- Annual Percentage Rate (APR): Represents the yearly interest rate of the loan, encompassing all fees and charges.
- Repayment: The total amount due, including both the principal and interest.
- Loan-to-Value (LTV) Ratio: Indicates the proportion of the loan amount to the collateral's value, used by lenders to gauge risk.
- Liquidation Threshold: This is the point at which the borrower's assets are sold off to repay the loan, triggered when the collateral value drops sharply.
Frequently Asked Questions
- Direct Loans from Lendz: Currently, Lendz does not offer direct loans, but this feature is expected to be available soon.
- Fees Charged by Lendz: There are no fees charged to either lenders or borrowers using Lendz.
- Safety and Security: Lendz prioritizes user safety and is considered highly secure for NFT lending.
- Interaction with Smart Contracts: While Lendz itself requires no direct interaction with smart contracts, obtaining a loan through recommended platforms will involve such interactions.
- Safety of Aggregated Platforms: Lendz carefully selects NFT lending platforms to ensure they are not only profitable but also secure, currently aggregating top platforms like Arcade, BendDAO, NFTfi, ParaSpace, X2Y2, and Zharta.
Lendz is dedicated to transforming the NFT lending landscape by offering streamlined, secure, and cost-effective borrowing solutions, empowering users to leverage their digital assets efficiently.
