What are Lease NFTs ?
When you stake an NFT, you get the yield up front and a clone of the NFT that we’re calling a “Lease NFT”. The Lease NFT mechanism is in place to facilitate lending. Lease NFTs can be sold on the secondary marketplace, but what must be remembered is that Lease NFTs have an expiry, based on how long the original NFT is being staked for. So a Lease NFT’s yield will be bound by the time remaining to the expiry date.
There are two reasons why Lease NFTs might be valuable to other hodlers to buy. Firstly, Lease NFTs can be leveraged to take advantage of left over VOID staking capacity that the original NFT owner did not use. For example, if the original NFT hodler stakes 1,000 VOID tokens to it, and it has a staking capacity of 2,000 VOID tokens, the owner of the Lease NFT can stake the extra 1,000 VOID tokens to it, and earn a yield on that stake (1,000 VOID) up to the expiration date.
The second reason someone may want to buy a Lease NFT is that they can be used for whatever utility the original NFT has. As an example, a Lease NFT of a HodlGod bounty contract can be used in-game just the same as the original bounty contract NFT.
Last modified 1yr ago