Start using NFTfi bundles for multi-collateral loans!
January 26, 2023 ・ 5 min read
We are excited to announce NFTfi bundles, a new way for borrowers and lenders to facilitate peer-to-peer NFT loans. NFTfi bundles allow borrowers to collateralize multiple NFTs at once, and renegotiate as well as renew multi-collateral loans quickly and gas-efficiently. Bundles also provide borrowers with added flexibility when negotiating higher-value loans with lenders.
A game changer for borrowers and multi-asset lending
Before this feature existed, if borrowers wanted to collateralize multiple NFTs to borrow a larger loan sum, they had to take out multiple individual loans secured by one collateral NFT each. Often, they would negotiate a multi-collateral deal with a lender and execute it via multiple single-collateral loans. Remember that famous 101 CryptoPunks loan on NFTfi? 101 individual loan transactions! This took a LOT of time - initially and for each loan renewal.
NFTfi bundles drastically simplify this effort: borrowers can just add as many NFTs as they like to the bundle via the UI, and then take out a single loan against all of them at once. Renegotiating or rolling over (renewing) such multi-collateral loans works the same way as for a single loan, hence drastically reduces time and cost for both borrowers and lenders.
At launch, you can use up to 236 NFTs in one bundle.
The most flexible and gas efficient NFT bundles to date
Unlike bundle solutions on alternative platforms, NFTfi bundles can be modified and reused indefinitely, which means borrowers do not have to recreate the bundle from scratch (and pay gas costs for every NFT they want to add) each time they want to remove or add NFTs for their next loan. They can just “unseal” (see below) the NFTfi bundle, make the desired changes, reseal it, and list it for the next loan. This makes NFTfi bundles, to our best knowledge, the by far most gas efficient and flexible way to take out crypto loans secured by multiple NFTs in the NFT lending space. Our gas cost test runs indicate that borrowers can save thousands of USD in gas by using NFTfi bundles vs. alternative solutions (depending on bundle size, gas price and ETH price).
How to start borrowing on NFTfi bundles?
To create a new bundle, you must have more than one NFT in your wallet. Go to the bundles section (Borrow/Bundles) and click the “Create bundle” button.
The bundle management UI (“Your bundles”) gives you an overview table of all of your bundles (see image below) and three distinct sections below the table to manage your bundles.
“Your NFTs” gives you an overview of NFT assets in your connected wallet. Any unlisted NFT asset can be added to the bundle. If you have an individual NFT asset listed and want to use it in a bundle, you must unlist it first. Click the plus icon to add assets to your bundle.
“New bundle” shows the currently selected NFT assets in your bundle. You can remove assets by clicking the minus icon or the “Remove all items” button.
“Bundle actions” leads you through the actions needed to get your bundle ready for loan:
- Mint bundle: Creates the bundle on-chain as an (unlocked/unlocked) ERC998 token. Before and after you mint the bundle, you can share its URL freely (e.g. to negotiate terms with a lender)
- Approve: Grants permission to allow the bundle smart contract to move your assets. This must be done once for each collection (if you add five assets from 5 different collections, five approvals are required).
- Save bundle on-chain: Saves all bundle information on-chain.
- Sealbundle: Locks/seals the bundle via an ERC721 wrapper contract.
- Unseal / List bundle: Unseal the bundle to modify the contents of the bundle, or list it for a loan. Once listed, you can start receiving loan offers on your bundle, or unlist it again at any time.
Gas is required when you mint, save, seal and unseal your bundle. In the “Your bundles” UI, you will see each bundle always be in one of the following states:
- Off-chain: Bundle exists in an off-chain database only. You can share its URL freely and then mint it as an (unlocked/unsealed) ERC998 token on-chain.
- Unsealed: Bundle exists on-chain as an ERC998 token. You can still add or remove NFTs freely, then save and seal the bundle using the ERC721 wrapper.
- Sealed: Bundle exists on-chain as an ERC721 token. It is now immutable, and no one can add or remove NFTs. The sealed bundle can be listed to receive loan offers.
- Listed: The bundle is listed as collateral in our database. Lenders can make loan offers.
- Escrow: Bundle is in the NFTfi escrow smart contract during an active loan.
- Defaulted: Bundle loan was not repaid before maturity and can be foreclosed or renegotiated.
At this point, bundles cannot be deleted once minted. Existing bundles can be indefinitely modified and reused. Private offers can be made on unlisted bundles but only if they are sealed.
Have questions or need more help?
If you have questions regarding NFTfi bundles, don’t hesitate to reach out in our Discord. We and our Ambassadors are here to help. Make sure you follow us on Twitter for future updates.
This article is for educational and informational purposes only and should not be considered financial advice. Conduct your own research and due diligence before making any investment or financial decisions, such as when considering novel products including NFT loans.
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