Illiquid from too many NFTs? Finally a solution with Mantra Protocol
We’ve all been there. So many amazing collections out there that a person can invest in. So much to gain from the LPs being held in various farms. And then a new collection comes out and there are insufficient funds to mint. “But I have 3200 NFTs!!”
What now?
Mantra is the answer.
Mantra Overview - https://withmantra.com/
Mantra is a peer to peer lending platform that allows users to take loans out against the value of their NFTs. Everything is determined by the users: the NFT (or collection of NFTs), the loan amount, the interest paid, and the period of time. If the borrower fails to return the agreed upon total including original amount plus interest on time, they forfeit ownership of the NFT(s) to the lender.
Mantra for Borrowers -
From the perspective of a borrower, this protocol adds immense potential lending power for individuals with large NFT collections. Imagine owning rares or a special and being able to utilize its value without having to sell! That’s now possible. One of the most amazing features of this protocol is the ability to combine multiple NFTs and even from different collections into one package deal. This allows for greater flexibility and maximum opportunity when borrowing. Again, everything is initiated and agreed upon by the users. The borrower makes the initial proposal:
The amount to be borrowed
Currency of the loan (currently up to seven options available)
Payback Interest (flat percentage)
Loan Duration
Once the asset(s) are listed, it’s important to keep on eye on what’s going on with any listings. Lenders have the option to fill the order as is or make a counter offer. These counter offers can include changes to any of the parameters selected when listing. There is no way currently to decline offers, borrowers simply just ignore them. Once a deal is accepted, the funds will automatically arrive in the borrower’s wallet (minus Mantra’s 2% protocol fee). Only thing left is to repay the loan on time! It’s imperative that borrowers track any ongoing deals to ensure they have sufficient time to repay. If not, the asset(s) will automatically be forfeited to the lender.
Important note: Any assets listed with a duration of 0 days will result in instant liquidation, essentially a sale instead of a loan.
Mantra for Lenders -
Now let’s take a look from the perspective of a lender. Mantra provides a unique opportunity to earn some great interest on some funds sitting idle, while also having a chance at snagging NFTs at cheap prices. Thorough evaluation is pivotal as a lender though to ensure a safe deal! Consideration must be taken of the Loan to Value (LTV) and how easily the NFT could be resold if the borrower defaults and the lender so wishes. On Mantra’s main page, lenders and buyers can shop around for deals using any number of filters including by collection and currency. Now let’s play with an example.
Let’s say an NFT is listed for 5 BCH at 10% for 30 days. For the sake of the example, the due diligence is done and the lender is comfortable with the LTV. It’s very simple, just click “Fill This Order!” Lender will pay the loan amount plus a 1% protocol fee. In this example, the lender will pay 5.05 BCH. Nothing else to do but wait! Upon the period of the loan ending, one of two things will happen:
Borrower pays back the agreed upon amount before the term ends. In this case, 5.5 BCH will automatically arrive in the lender’s wallet.
Or if the borrower fails to repay the loan on time, the deal will now be listed under “My Unclaimed Assets” and the NFT can be claimed.
Now let’s look at an alternative outcome. An NFT is listed for 5 BCH at 10% for 30 days, but the lender, upon their research and due diligence, is only comfortable lending 3 BCH….. What now? It’s very simple! Simply click “Make a Different Offer” and change the terms to whatever is desired. As mentioned earlier for borrowers, it’s equally important for lenders to pay attention to any outstanding bids. The funds will be held until either the borrower accepts or the lender cancels the bid. Borrowers cannot decline bids, so it’s up to the lender to reclaim funds if another bid has been accepted or they no longer wish to lend on that deal. If the lender cancels the bid, the full amount including the 1% protocol fee is returned.
Mantra Bulk Sales -
One important byproduct of the Mantra lending protocol has been the capability of bulk sales. Unlike traditional NFT marketplaces where individual assets are listed, Mantra allows many to be listed together, even from different collections! This has been a wildly popular and successful feature thus far. If the goal is to list assets as a bulk sale, simply list the duration as zero days!
That’s all there is to it!! Mantra is a powerful new protocol that allows borrowers to unlock the value of their NFTs in a way never available before. No more missing those huge farm APRs or new collection launches! As a lender, a new opportunity is given to earn great interest rates on those idle funds. As a buyer, there are wonderful opportunities every day for discounted collections in bulk. Check out the community telegram and real time feed for ongoing deals below!!
Mantra Community Telegram - https://t.me/MantraProtocol
Mantra Live Market - https://t.me/MantraProtocol_Realtime
